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Roku Stock Plummets Amid Silicon Valley Bank Drama

Puts are being picked up at a much faster-than-usual rate

Deputy Editor
Mar 13, 2023 at 10:49 AM
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Roku Inc (NASDAQ:ROKU) stock was last seen trading at $57.83 after shedding 3.6%, following news that a large of amount of its cash reserves are stuck with SVB Financial Group (SIVB).

On Friday, the streaming and media company said in an Securities and Exchange Commission (SEC) filing that the tech lends held 26% -- or roughly $487 million -- of its cash. Roku noted it did not know to what extent it would be able to recover its cash on deposit at SVB, but added it can meet capital obligations over the next 12 months and beyond.

Puts are picking up steam in the options pits. So far, 60,000 bearish bets have been exchanged, which is six times the intraday average, and far outpacing the 12,000 calls traded. The most popular position is the March 50 put, where new positions are being opened.

Short-term option traders have targeted puts with vigor recently. In fact, the stock's Schaeffer's open interest ratio (SOIR) of 1.20 sits in the elevated 82nd percentile of its annual range, indicating short-term option traders have rarely been more put-biased. 

On the charts, ROKU is trading at its lowest level since Feb. 14, though its 120-day moving average is keeping the pullback in check. Year-to-date, Roku stock remains up more than 43%.

 

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