🐧Trade Type

The type of Option flow order

Block is a single order with an abnormally high trading volume than the average level. Blocks can be counted both by dollar value and contract size. Different trading platforms, information providers, and individual traders might have slightly different methods of defining the threshold volume and referred trading timeframe. The situation can also vary on different equity objects. Generally, a block is confirmed when a single trading volume accounts for over 5 times of last 30-day average exchange volume for all options markets of the underlying equity. The catalyst of a block is a real hurry and strong money flow to get filled by market players. Those market players are often big institutions or we called “insiders” who have a relative edge over trading information, money pool, and algo system.

Sweep is the other type of unusual options activity as trading orders spread on multiple exchange markets. A sweep is typically a large order that is broken into a number of different smaller orders that can then be filled more quickly on multiple exchanges. A sweep order instructs the broker to identify the best prices on the market, regardless of offer size, and fill the order piece-by-piece until the entire order has been filled. The catalyst for sweep orders is to hide intention from the executer and make those orders stay “irrelevant”. This can be also a track of smart money who might be certain on the next day's market volatility with an edge but would not like to be radared. The other aim of a sweep may be taking as many as available contracts at the best prices, which indicates an aggressive bet on the underlying asset market. Traders choose to make sweep order as the trading cap of a single exchange is not able to fulfill their position. Let’s take a dip into a sweep order captured by our platform on 28th February. In the order details, it shows a trade count of 9. In other words, the order is executed in 9 different exchange markets with a total volume of 1500 lots. If we are not able to radar those orders from one single source, these orders might be casually taken as irrelevant small orders without a hint.Figure 1: A sweep order on OPRA 28th February