Has Roaring Kitty sold some of his $20 GameStop (NYSE:GME) call options? Yesterday’s options data suggests that this could be the case.
Roaring Kitty, whose real name is Keith Gill, last disclosed his GME stock position on June 10 via an account screenshot to Reddit. He owned 5 million shares purchased at an average per share price of $21.27 and 120,000 $20 call options with a June 21 expiration date. On that day, there were a total of 166,405 contracts outstanding for the $20 strike price.
On Wednesday, volume for the $20 call options reached a staggering 93,000, with many of the sales coming in through blocks of 5,000 contracts or more. This could align with Gill’s large stake, although this has not been confirmed. Volume for all of GameStop’s options was 1.2 million contracts yesterday, “66% higher than the average daily volume for the stock’s options over the last month,” per Reuters.
Susquehanna International’s Chris Murphy believes that Gill is in the process of winding down his position.
“While he did not finish closing he probably has enough cash now to exercise the rest if he wanted to,” said Murphy.
GME Stock: Did Roaring Kitty Sell Some of His $20 Call Options?
According to Trade Alert, many of the $20 call option trades yesterday were transacted below the bid price, which hints that a seller was trying to exit their position quickly.
With Gill remaining quiet on social media, speculation is starting to build that he did indeed sell out of some of his calls. Interactive Brokers Chief Strategist Steve Sosnick pointed out that no one besides Gill would be the obvious culprit.
There’s also the fact that exercising the options could present an issue. If Gill decided to exercise, he would need $240 million in cash to take delivery of the shares. That’s calculated by 120,000 contracts x 100 (each contract represents 100 shares) x the $20 strike price. As of June 10, his cash balance was only $29.40 million.
Gill could also decide to roll his options to a later expiration date, although none of this can be confirmed until we hear from Roaring Kitty himself.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
