The OPEX Effect Low Volatility Is Lying to You | What the Options Market Says About What Comes Next
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Aug 9, 2025 Dive into the fascinating world of market dynamics as the hosts explore the intriguing 'Honey Badger' and 'Zombie' markets. They unpack record-high options trading volumes and discuss the potential for a volatility spike against the backdrop of low realized volatility. With tech call options at their cheapest in a year, they decode the implications for investors. Tune in for insights on the impacts of shifting tariff policies and the role of market maker hedging in creating unexpected price movements!
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Options Volume Is Moving Stocks
- Brent Kochuba says exploding options volume drives hedging flows into equities.
- Market makers buy or sell underlying shares to hedge options, creating a transmission mechanism that can lift or press stocks.
OpenDoor Meme Move Driven By Options Flow
- Brent describes how meme stock option buying forces market‑maker hedges that buy the underlying stock.
- OpenDoor's huge options flow produced a rapid spike that mostly faded within days, showing how flow‑driven squeezes can be fleeting.
Zero‑DTE Dominates Intraday Flow
- Brent Kochuba notes over 60% of SPX order flow is tied to zero-DTE trading.
- That creates intraday cycles and idiosyncratic moves which compress and accelerate market action.