Block Trades
Large option orders (typically 50+ contracts) executed as a single transaction. Often signal institutional conviction.
Block trades are large option orders — typically 50 or more contracts — executed as a single transaction, often at or near the ask price (for buys) or bid price (for sells). These trades are significant because retail traders rarely execute orders this large. Block trades usually represent institutional activity: hedge funds taking directional bets, asset managers hedging portfolios, or corporate insiders managing equity compensation. Their size means they carry more informational weight than typical retail flow.
Not all block trades are directional bets. Some are hedges against existing stock positions, rolls from one expiration to another, or legs of multi-strategy portfolio adjustments. The most informative blocks are those that are clearly directional (buying calls at the ask or puts at the ask), occur in unusual strikes or expirations, and represent a significant percentage of the day's total volume. Repeated block trades in the same direction strengthen the signal.
Options Pilot's Activity pillar tracks block trades as a component of the unusual activity detection system. When large blocks align with other Activity signals (volume surges, rising open interest), the combined signal is stronger. The Sentiment pillar's Smart Money Score also incorporates block trade direction to assess whether institutional positioning is bullish or bearish.
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Block Trades is part of the Activity pillar in our 5-pillar scoring system.
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