This weekly newsletter pulls together summaries of the top ten most-read Insights across Equity Derivatives on Smartkarma.
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1. Toyota (7203 JP) Tactical Outlook Following Toyota Industries (6201 JP) Privatization Rumors
- Toyota Motor (7203 JP) said in a Tokyo stock exchange filing on Saturday that it is exploring the possibility of investing in a potential buyout of key supplier Toyota Industries.
- Bloomberg reported Friday that Toyota Motor (7203 JP) Chairman Akio Toyoda and his family proposed acquiring Toyota Industries (6201 JP) in a possible 6 trillion yen ($42 billion) transaction.
- The stocks of both companies were rising on Monday, this insight focus on tactical positioning on Toyota Motor:the stock appears very OVERBOUGHT according to our models.
2. Alibaba (9988 HK): Top Trades and Strategic Insights from HKEX Options Trading
- Over the past five trading days, Alibaba Group Holding (9988 HK) multi-leg option strategies showcased a variety of approaches. Strategy highlights are provided.
- Diagonal Spreads account for nearly 30% of all strategies. Many of these strategies sell short term risk to finance longer term protection.
- Several structures hedge against low probability tail events. One such strategy traded 100 contracts.
3. Alibaba (9988 HK): Volatility Surface Favoring Diagonal and Calendar Spreads
- Alibaba Group Holding (9988 HK) one-month implied volatility has decreased from recent peaks but remains above the 70th percentile, while realized volatility exceeds 80% (96th percentile).
- A relatively flat term structure and skew render Calendar and Diagonal Spreads interesting strategies.
- Open interest extends to March 2026, with balanced call and put interest across all expiries.
4. ASX200 (AS51 INDEX) Outlook: Rallying Out of a Bear Market Amid Passive Flows And Sector Strength
- Over the past three weeks, the S&P/ASX 200 (AS51 INDEX) has staged one of the strongest rebounds since the early April Trump-tariff shock, rallying approximately +15% from its 16-month low.
- Several factors are driving the rally: recent passive flow activity, as highlighted by Brian Freitas but also broad-based sector strength, with notable gains in energy, healthcare, and consumer staples.
- Despite a positive outlook, our models indicate the index is currently OVERBOUGHT. This insight breaks down the key details.
5. Gold (GOLD COMDTY) Outlook And Profit Targets
- Gold (GOLD COMDTY) has been in an a prolonged uptrend for several weeks, 1-week pullbacks have been buy-the-dips opportunities so far.
- Last week Gold closed down, a modest 1-week pullback, it may be an opportunity to buy but we want to show you where is the ideal support zone to buy.
- In this insight we will also identify also profit targets, in case gold keeps rallying from here, so that you know how far the rally can go.
6. Nasdaq 100 (NDX INDEX) Outlook: Is The Bear Market Over or Not?
- The Nasdaq-100 Stock Index (NDX INDEX) stalled this week. The week is not over yet, but let’s take a closer look at our tactical model to assess short-term scenarios.
- Obviously tariffs will impact the economy but often markets can defy rationality, leading to short-term pain if we’re positioned incorrectly.
- This insight evaluates how far the rally could extend and how deep a pullback might go, this can be of interest to option desks or to anyone looking to hedge.
7. BYD (1211 HK): Top Trades Reflect Bearish Bias in HKEX Options Trading Strategies
- Over the past five trading days, BYD (1211 HK) multi-leg option strategies showcased a variety of approaches. Strategy highlights are provided.
- Popular Strategies: Call/Put Spreads account for 88% of all strategies, with a bias towards bearish views.
- Lottery Trades: a recent trend, observed in other stocks as well, manifests itself in BYD (1211 HK). A lotter trade bets on a low probability event with a high payout.
8. Tencent (700 HK): Volatility Smile Signals Strategic Opportunities in Options Trading
- Implied Volatility Trends: One-month implied volatility for Tencent (700 HK) has declined from recent peaks, aligning near its 3-year median, indicating a potential stabilization in market expectations.
- Skew and Term Structure Dynamics: The term structure is largely flat with a slight uplift due to the upcoming earnings on 14 May 2025. A pronounced volatility smile favors spreads.
- Open Interest Distribution: Liquidity is concentrated in near-term (April, May) and quarterly expiries, with call open interest slightly outweighing puts (48-60%).
9. Tencent (700 HK): Top Trades and Strategic Insights from HKEX Options Trading
- Over the past five trading days, Tencent (700 HK) multi-leg option strategies showcased a variety of approaches. Strategy highlights are provided.
- Popular Strategies: Call/Put Spreads account for 70% of all strategies. With a bias towards bullish views, Bull Call Spreads outnumber Bear Put Spreads by 2:1.
- Lottery Trades: following observations of such strategies in other stocks, a lotter trade bets on a low probability event with a high payout. Trade size tends to be sizable.
10. NSE NIFTY50/ Vol Update / Option Markets Remain in High Vol-Regime
- IVs rise as markets return from holiday-truncated week, moving from 14.2% to 15.8%. Monthly contracts benefit most as they capture multiple tier-1 event risks.
- “High & Up” vol-state persists. Though there is a high probability of switching to “High & Down” with slight IV stabilization.
- TACTICAL IMPLICATIONS: Avoid negative Gamma/ Smile/ Vega exposure. Wait for vol-regime shift before initiating new risk-premia harvesting structures
