Stumbled upon CLAR tonight and hoping someone smarter than me can explain what’s going on with this stock.
Shares outstanding is approximately 35M
Insiders own 18.49%
Institutions own 91.71%
112.51% of float is own by institutions.
Not sure how that even makes sense.
Float is estimated at 25M shares. The company has issued a $50M share repurchase program, approved 2 insiders to increase to 12.5% ownership, and recently announced consistent earnings. The stock has become violently volatile hitting its ATH, then crashing down to about where it stands. The company thinks 2 funds are manipulating the stock as they are unsure why their stock has become so volatile.
Currently SI is estimated at 30% as of 8/15
The option chain is jacked. Not much ITM but 91k OI alone on the October 30c with 10k+ volume today alone.
A lot of the recent big bets are filled at the mid, making them open for interpretation. However, the put size is quite big. For a bullish interpretation, I wonder if the trader STO those puts and then BTO calls with the premium and pocket the remainder? Or, if this price action is truly being manipulated, maybe the trader closed those puts for fat profits and are now trying to make money on the reversal?
I’m currently having a look at the SEC filings and looks like a company called Parallex bought Shares and another called Greenhouse has requested to buy another few 100k, along with another called brown. Please tear me to shreds on this as I have the reading age of a toddler.
Actually, looked like parralex dumped 1.2m shares recently? Looking at the M5 chart, theres one absolutely massive volume candle that seems to have started this whole thing, although it did rebound.
“The Company’s board of directors reserves the right to pursue any and all remedies available against Parallax, including, without limitation, taking action to trigger the remedies under the rights agreement which would result in material dilution in the economic value of Parallax’s ownership in Clarus’ common stock.”
“The Company has contacted the enforcement division of Nasdaq regarding trading activity in its common stock, continues to actively investigate the trading in its common stock as well as related derivatives by other entities, and reserves the right to pursue any and all remedies available against any person or group that is engaging in any manipulative trading activities and/or that acquires 4.9% or more of Clarus’ common stock without the approval of its board of directors in violation of the rights agreement.”
from that article, seems like they were threatening dillution but parallax reduced their stake? Seems like they reduced their stake to 4.4% as they need approval from the board for more?
Well this has caught my attention. I’m going to dig into this.
Really interesting find guys!
Alright, I’ve dug into this a bit more. I’m skeptical.
I don’t know who ‘Maskless_Warrior’ is but they are all over this everywhere I turn. Maybe legitimate, maybe a furu but I found his Reddit and it’s interesting. I am cautious by nature and therefore I prefer tread carefully. Further undoing requires understanding.
News
Clarus management released a statement indicating the company is prepared to fight off a recent move by an activist investor to acquire more of its shares. The rally was likely caused by the statement which indicated that Clarus is prepared to fight off the moves made by Caption Management LLC.
Analysis
We have seen this type of movement before where something pops, then it drops and pops again. GME, AMC, and ESSC all come to mind. So while CLAR already had a pop we may just be seeing normal consolidation movement that leads to another pop. I suppose it’s possible that this squeezes. Don’t misconstrue what I am saying though. I am not saying CLAR is going to be another GME or AMC.
Just to contribute here, the next upcoming weekly Opex on 9/16 does have a strong negative gamma bias. This is hard information to weaponize but what we can discern is that the majority of the put volume is in the money next week. We’ve seen in the broader market that when the majority of the OI is ITM, we can see some unwinding happening and a push in the opposite direction. This isn’t a science and doesn’t always happen this way but there’s some correlation there.
Increased sentiment on this one I think is the most interesting part of this ticker. Certain terrible stocks have shown us that things will run for no reason as long as there’s enough people jumping into it. Right now on Twitter it’s really just a couple people watching it and they agree that this is “Something to watch” but it doesn’t seem that it’s definitive even from some of the furus.
Another instance today of a large put leg coupled with a smaller-but-still-big call leg.
This time for that infamous 10/21 30 strike. But note that the put leg is much closer to the bid side rather than the ask side of the spread… Which means more likely a Sell of the put. Whether that’s STC to STO is open to interpretation.
I don’t know why I didnt look at this sooner, looks like this massive october OI was filled literally right before the first dump at around 4.6 each… im guessing someone made a lot of money selling calls…I think the play here could be to buy calls once these expire as theres a potential some MMs are short a few M shares to hedge long calls. Short interest is around 7.6m.
It’s possible if this continues to push up we see something of an inverse gamma squeeze where Instead of MMs hedging short calls by buying stock, we see MMs begin to buy stock to de-hedge their calls and covering their shorts. The delta on those calls is 0.09 so assuming they’re delta neutral would mean they’re 99% hedged.
Part of me is wondering if this hit some critical point where MMs are all hedged up and now it’s going to trickle back up.
Either way if I play this, I’m going for the November 17.5c
Top chart is stock price, bottom chart is the call volume on the october 30s.
Kind interesting to see hedging in real time, you can see the calls were (most likely) sold at 8:30 and then hedged around an hour later.
If someone has ORTEX could you look confirm the data on this?
Looking at this we had about 4 days of severe shorting, Calls were opened on 8/23 and the dump began 2 days later on 8/26. There’s potential it underwent a reverse gamma squeeze? ( shorting the stock to hedge their long calls)
But then theres that 1m+ short volume day on 8/22 which is weird and had no effect on stock price.
Says in that article he got liquidated in two days… some of these options have volume before the dump and some abit later. But then that just raises the question of who the 80k OI on the October chain is.
I set up a risky operation where I sold put options and bought call options from a company I know deeply (Clarus, ticker NASDAQ:CLAR US). Until a week ago, the trade was going well, but five days ago, to get out of the operation, I had to leverage the fund for a few days. The day after this leverage, our custodian, faced with the concentration of the portfolio, decided to withdraw all the margin they had given the day before. As a result, I was forced to liquidate the position in two days, which caused irreparable losses to the fund.”
The dude was margin called that’s all.
The focus should not be on who is on the chain but why they are on the chain. What are we missing in our analysis that is it making this play clear?
