Big Money, Day Traders Both Love Japan Tech Darling Mercari

(Bloomberg) — Mercari Inc., the online flea-market operator that has become one of Japan’s most closely watched tech ventures, is closing in on new highs as the stock has drawn both big and small money.

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The company has already grown to command the largest weighting on Japan’s startup-focused Mothers index as individual investors buy in — of some 230 of the largest Japanese companies with market value of over $5 billion, Mercari has the third-highest percentage of individual shareholders. Then on Oct. 7, Los Angeles-based money manager Capital Group declared it had taken a 5% stake in Mercari.

That’s helping propel the stock to near the 6,000 yen mark it hit just once, on the day it listed to great fanfare in 2018. After a rapid decline, the stock has worked its way back up this year, fueled by its first quarterly operating profit. That’s been helped by

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Tencent Stock Options Cost a Fortune and Traders Love Them

(Bloomberg) — Caught off guard by Tencent Holdings Ltd.’s record-breaking rally earlier this year, Hong Kong’s stock investors are getting well prepared for the next one.

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For about two months, options traders have consistently shelled out more for bullish three-month contracts on the stock than they’re willing to pay for those protecting against losses, according to data compiled by Bloomberg. That’s kept Tencent’s so-called volatility skew below zero, an unusual quirk for a market that typically sees traders pay more for downside protection than upside speculation.

There are now almost 1.1 million outstanding options on Tencent, outnumbering those on the Hang Seng Index by more than 4-to-1. The demand for the derivatives mirrors a trend in the U.S., where volume in single-stock options exploded this year and helped underpin the rally in technology shares.

How Tech Options Juiced the U.S. Stock Market: QuickTake

The world’s eighth most valuable

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Traders say the Softbank ‘whale’ may be back as options activity spikes for Big Tech stocks

Wall Street traders said that an unusual spike in call options on Thursday shows that Japan’s Softbank may once again be betting on large tech stocks, CNBC’s David Faber reports. 

Multiple sources told Faber that there was $200 million spent on Thursday morning on call options for Netflix, Amazon, Facebook and Alphabet, with the investment bank being the most likely buyer. 

“A number of sources in the derivative markets on major trading markets noting that significant call buying, and they all point to Softbank as being behind it,” Faber said on “Squawk on the Street.” 

Reports by the Financial Times, Wall Street Journal and other outlets identified Softbank as the Nasdaq “whale” whose massive options activity led to a boom for major tech stocks in August. The news led to a sell-off in Softbank’s stock in early September as investors worried about the new strategy for the bank and its

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September Technology Calls Expire Worthless for Robinhood Traders

The last few months have been terribly exciting for the technology sector. It is the most loved and the most hated at the same time.

Long-term players want to be long the sector but cannot justify adding to stocks when they are at nosebleed levels and are too scared to average in higher. Short-term players always try to short the sector, trying to call a top, but they risk getting burned as the momentum is just too strong and wipes them out. Because of the massive weighting of these stocks in the large-cap indices, what happens to them has huge bearing on what happens to the rest of the sectors and industries, and vice versa.

Back in August, the S&P 500 moved 8% higher on light volume and no new news about the economy or the recovery. It was a handful of stocks dragging the index higher, among them Amazon

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