Fortune is reporting on some odd goings ons in regards to Apple’s stock price and weekly options market (rights to purchase stock at a named price at the end of a period). The report notes that Apple’s stock sees a price shift on Friday as those trading options expire, which means large traders lose any […]
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Apple Stock Price Being Manipulated in Options Market?

apple_logo_grey.gifFortune is reporting on some odd goings ons in regards to Apple’s stock price and weekly options market (rights to purchase stock at a named price at the end of a period). The report notes that Apple’s stock sees a price shift on Friday as those trading options expire, which means large traders lose any gains they made as the price of shares makes it’s way to matching that week’s strike price. This in turn lowers the stock price, which will affect folks like you and me as well.
Here is a quote from the report that I think explains it better than I just did:

It was 3:48 p.m. on Friday April 29 and traders who had purchased Apple (AAPL) April 29 $350 “calls” — options that gave them the right to buy Apple shares in blocks of 100 for $350 per share — were sitting pretty. The stock was trading around $353.50 and those calls were worth more [than] $350 apiece (the difference between the price of the stock and the so-called “strike price” of the option times 100).

Then, in an extraordinary burst of trading — exacerbated by the rebalancing of the NASDAQ-100 scheduled for the following Monday — more than 15 million shares changed hands and the stock dropped below the $350 strike price just before the closing bell. Result: The value of those calls disappeared like a puff of smoke.

Digging further, Fortune has compared the stock prices, of each trading day, for over eight weeks. They then compared the “max pain” prices (when puts and calls have the least value when put together) to the Friday closing prices. On a very regular basis it was found that Apple’s stock prices headed for the max pain point every Friday before closing.

Some are claiming that this is due to trader hedging. More likely this signifies someone, or some organization is manipulating the Apple Stock price, which is a highly illegal activity here in the States.

For once, this is something that I had noticed on my own, but didn’t really pay it any attention. And it never seems to be a huge dip in price, but a dip none the less. God only knows who’s behind it, and whether they’ll ever be caught.

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