Weekly Top Ten Equity Derivatives – Jun 1, 2025

1. Alibaba (9988 HK): Unpacking the Week’s Savvy Top Options Trades

By Gaudenz Schneider

• Over the past five trading days, Alibaba Group Holding (9988 HK) multi-leg option strategies showcased a variety of approaches. Strategy highlights are provided.
• Popular Strategies: Over 35% of all strategies are Calendar or Diagonal Spreads. Bullish and bearish views prevail at equal rates, with very few market-neutral views expressed.
• Top Trades: Some market participants were betting on a short term re-bound after the post-earnings drop. Others take a bearish view with finely calibrated medium-term hedges. Trade-examples are presented.

2. Alibaba (9988 HK): Navigating Post-Earnings Volatility

By Gaudenz Schneider

• Implied Volatility Trends:Alibaba Group Holding’s (9988 HK) one-month implied volatility has significantly receded to the 37th percentile after its 15 May earnings, reflecting a substantial implied vola crush.
• Skew and Term Structure Dynamics: The implied volatility term structure is now slightly upward-sloping with longer-dated options commanding a small premium. Skew dynamics indicate cheaper puts.
• Open Interest Distribution: Liquidity is greatest in the June and September expiries. Short term strikes are concentrated near or at the money.

3. HDFC Bank Tactical View: Inflection Point or Just a Pause?

By Nico Rosti, MRM Research

• HDFC Bank (HDFCB IN) is navigating a mix of positive growth indicators and emerging regulatory challenges but average 12-month target is ₹2,194, with estimates ranging from ₹1,627 to ₹2,793.
• Consensus rating: predominantly “Buy” from major brokerages, including ICICI Securities and Motilal Oswal, citing strong loan growth and stable asset quality.
• The stock’s strong fundamentals and growth outlook remain intact, but momentum has stalled in recent weeks following the sharp rally we correctly anticipated from January 14, 2025.

4. CATL (3750.HK): Rich Vols, Strong Start, and a Tactical Hedge

By John Ley, Clifton Derivatives

• CATL’s options debut in Hong Kong has been active, with strong Call interest and rising open interest suggesting early investor enthusiasm.
• Implied vols are holding firm post-listing and appear rich —potentially justifiable given the trading dynamics and catalysts.
• We recommend a tactical hedge structure that skews return favourably, targeting recent highs and protecting against downside drift.

5. China Mobile (941 HK) Poised for Pullback: A Tactical Low-Cost Options Play With High Upside

By Gaudenz Schneider

• With a 5-week rally China Mobile (941 HK) is in overbought territory and quantitative models flag potential for a pullback.
• Options may be underpricing the downside risk, creating an attractive opportunity to buy cheap options with high payoff potential.
• This Insight outlines an option strategy combining quantitative signals with volatility analysis.

6. KOSPI 200 Tactical Outlook After Index Rebalancing

By Nico Rosti, MRM Research

• Korea Exchange announced its KOSPI 200 rebalance changes on 27 May, Sanghyun Park and Douglas Kim wrote extensively about this, here we want to focus purely on the tactical strategy.
• The KOSPI 200 INDEX pulled back last week, then surged on Monday and stagnated on Tuesday, the index has plenty of room to go higher according to our model.
• According to our model, the number of rallies vastly offset the number of pullbacks when this pattern is encountered (=pullbacks are rare), this could be read as a bullish indication.

7. HSI Index Options Weekly (May 26-30): Choppy Tape, One Strike Rules Them All

By John Ley, Clifton Derivatives

• HSI traded sideways for a third straight week as macro headlines swirled and tariffs turned internally litigious.
• Volatility drifted lower, with 1M implied vol dropping below its 1-year median for the first time in months.
• Call volumes were significantly higher led by one strike in particular.

8. All Eyes On Nvidia (NVDA US): Post-Earnings Outlook and Profit Targets

By Nico Rosti, MRM Research

• By the time this insight is published, NVIDIA Corp (NVDA US) will have reported earnings. Our model does not rely on fundamentals or news, so the forecast is made in advance.
• The stock pulled back last week, mild pullback, not oversold, ideally a buy-the-dip opportunity. Support targets: 123-112
• If the stock rallies, the rally could last 3 weeks and reach 156. Read the detailed analysis in the insight.

9. Nifty Index Options Weekly (May 26 – 30): Rally Pauses, Vol Holds at Elevated Levels

By John Ley, Clifton Derivatives

• Nifty had limited movement this week with the rally off the April low stalling out.
• Elevated volatility metrics contrast with an otherwise quiet tape over the past week. We recommend taking some chips off the table, taking advantage of vol levels. 
• Nifty has given up about 1/2 its outperformance vs the SP500 over the past couple of weeks. 

10. TLT – From Hedge to Risk Asset: Behavior Continues to Shift

By John Ley, Clifton Derivatives

• TLT is showing signs of shifting behavior, no longer acting like a classic flight-to-quality asset.
• One-Month implied vol sits above average, though not at extreme levels.
• The evolving vol structure suggests caution for those expecting traditional bond market flight to quality behavior.