Time: 2024-06-26
With the impressive gains Rivian Automotive (NASDAQ: RIVN) has experienced in the pre-market by adding almost 50% to its price, the news has quickly gripped the EV investor community. However, it seems that RIVN stock has already been the victim of insider trading. A single trader bought $14 call options and $13 call options, both set to expire on June 28. If Rivians stock, currently trading at $16.95 in the pre-market, maintains its upward momentum, the holder of these options stands to make substantial profits that measure in millions from his initial investment of $16,000.
On the other hand, the RIVN stock surge has caused millions of dollars worth of losses to short sellers, with a high interest of 18.85 % in Rivian shares and an average coverage of 4.48 days, meaning that most of them got liquidated. Additionally, this high level of short-seller activity combined with a sudden stock surge could lead to a potential short squeeze of RIVN stock, pushing its price up even further.
The stock price of electric vehicle (EV) manufacturer Rivian Automotive (NASDAQ: RIVN) continues to record significant short-term gains amid increased interest in the company. During this short-term rally, select investors are employing various strategies to achieve substantial profits. One of the latest strategies saw a mystery investor transform a $25,000 investment into a staggering $2.5 million overnight, as highlighted by equities commentator Manz in an X post on June 26.
According to the shared data, the investor purchased 5,000 call options for Rivian for $0.05 per option. These options expire on June 28, 2024, and a strike price of $14. The implied volatility of these call options is notably high at 134, reflecting significant market expectations of potential price movement. At the time of the transaction, Rivians stock was trading at $11.73.
Indeed, Rivian stock has been a source of speculation for insider trading, resulting in some investors earning significant profits. For instance, a single trader bought $14 call options and $13 call options, both set to expire on June 28. With an investment of $16,000, the trader was poised to make millions in profits. Meanwhile, Rivian stocks bullish sentiment can also be attributed to the growing trust in the company from established entities. Particularly, the latest development involved an investment of up to $5 billion by German automaker Volkswagen.
By press time, Rivian stock was trading at $11.96 with 24-hour gains of over 8%. On the weekly chart, the stock is up 10%. The bullish sentiment is also reflected in the pre-market, with the stock likely to open higher on June 26, up 38% and trading at $16.54. Overall, Rivian will likely continue with the bullish sentiment if the stock successfully holds above $15, as this will open the door to breaching the $20 resistance mark.
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