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Who lost money during this deal? Or generally who indirectly paid these lucky gamblers?


Everyone else, indirectly. So other investors who weren’t in on it, pension funds, John Doe in his retirement home.


The people holding the ETF and selling the option. If they had not sold the option, they would have benefited from the value rising, now they instead got (collectively) $2.5M.

If the price had stayed flat or dropped, they would of course still have the $2.5M.

The precision makes it look a lot like a crime, as trading on information that's not publicly available is illegal.


Note that you don’t need to own the underlying equity to write an option contract. You only own the stock as a hedge.

Owning the stock is a specific lower risk strategy called a covered call.


This option was OTM so they also (presumably) profited from selling. Just a capped profit


The market makers who were short the call options or other market participants who sold calls. Mostly the latter, MMs are pretty good about hedging their positions but I’m sure some were caught offsides.


Who lost money? It’s difficult to say, because the purchase of those calls did not really tipped the market in any direction, but just provided liquidity for the sale of those call options.

Whoever shorted those calls made some money in the contracts, but they were going to lose money anyway the moment of the announcement.


Long term this also really hurts the faith in the market, so it's going to hurt a lot of people who have exposure to anything on US exchanges.


The poors. It's always the poors




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