Hedge Fund Cuts Twitter, Apple Stakes

TWTR and AAPL are down sharply after Einhorn's hedge fund exited its position

Oct 5, 2018 at 2:45 PM
facebook X logo linkedin


Rising bond yields are weighing on stocks, erasing the Dow's weekly gains in the process. Three notable stocks trading lower are social media concern Twitter Inc (NYSE:TWTR), electric automaker Tesla Inc (NASDAQ:TSLA), and iPhone maker Apple Inc. (NASDAQ:AAPL). Here's what's moving shares of TWTR, TSLA, and AAPL.

Greenlight Capital Closes Out of TWTR

TWTR stock is trading up 0.4% at $28.34, even after news that David Einhorn's hedge fund, Greenlight Capital, exited its position in the third quarter, citing regulatory concerns. The shares are now trading right above the 320-day moving average, a trendline not touched since last October.

It's been a rough run for Twitter since its June peak of $47.79, but near-term options traders remain convincingly call-skewed, according to the equity's Schaeffer's put/call open interest ratio (SOIR) of 0.68. Longer-term traders have targeted calls, too, with peak open interest sitting at the January 2019 37-strike call.

Musk Tweet Sends TSLA Lower

TSLA is again front and center, down 7.5% to trade at $260.63, extending a recent sell-off following a meet-up with its 200-day moving average earlier this week. The move lower comes after CEO Elon Musk again took to Twitter, this time to refer to the Securities and Exchange Commission (SEC) as the "Shortseller Enrichment Commission" in reaction to his yet-to-be-approved settlement with the SEC. What's more, David Einhorn, who's short the stock, compared the company to Lehman Brothers, writing to investors that "deception is about to catch up to TSLA."

Tesla shares are trading just above the $250-$260 range that's contained previous pullbacks this year, but many options traders may be hoping for more losses, since there's been unusual put buying on the equity in recent weeks. Specifically, the security's 10-day put/call volume ratio at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) comes in at 0.99, which ranks in the 79th annual percentile.

Trade Uncertainties Scare Greenlight From AAPL

Einhorn's Greenlight Capital also closed its AAPL position, sending shares of the tech stock down 1.7%. to $224.05, adding another down day to a typically strong month. Einhorn's firm cited trade uncertainties between the U.S. and China as the reason for selling Apple. The security has already pulled back quite a bit since its record high of $233.47 on Oct. 3, but remains up 44% year-over-year.

It looks as though near-term options traders may be properly positioned for a pullback, though. This is according to AAPL's SOIR of 1.16, ranking in the 84th annual percentile, confirming an unusual put-skew among those targeting options that expire over the next three months.

 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI