NFLX Sinks 7.2% as Put Option Volume Spikes: What’s Behind the Surge in Oct-24-25 1100 Puts?
Click to View this Option in the NFLX Option Chain Profit Calculator
Massive Put Volume and Price Decline Stand Out in Morning Trading
As of 10:00 AM, Netflix (NFLX) shares are down a steep 7.2%, dropping $89.35 to $1,152.00. While the stock retraced, one options contract drew outsized attention: the Oct-24-25 1100 put, which traded 3,870 contracts — about 5.9% of total options volume for the morning. The burst of activity in this single strike stands in stark contrast to typical trading patterns, marking it as the most active NFLX option in the session so far.
Implied Volatility Plunges Over 52% Despite Hefty Put Buying
The heavy trading in the 1100 put didn’t translate to sky-high prices. Instead, implied volatility (IV) on this contract actually plunged: VWAP IV is 37.2, down a dramatic 52.6% from the prior close of 78.5. Trades occurred from as high as $8.00 to as low as $1.60, with the last trade matching the session’s low at $1.60. That means option prices have not been driven up despite the demand — potentially a sign of fast hedging or sellers absorbing retail flows.
| Contract | Volume | VWAP Price | VWAP IV | IV % Change | % Total Vol |
|---|---|---|---|---|---|
| Oct-24-25 1100 Put | 3,870 | $4.93 | 37.2 | -52.6% | 5.9% |
Order Flow Skews Slightly to the Buy Side, But Retail Drives Action
Looking at order flow, 52.2% of these puts were bought to open, versus 47.8% sold, suggesting a slight edge for traders betting on further downside. However, it’s notable that 78% of the action was attributed to smaller, retail-sized trades, while just 22% was considered institutional or large-sized. This suggests the move is not yet dominated by a large institutional view, but is still broad-based.
Open Interest Jumped Over 1,900 Contracts Overnight — More to Come?
While today’s trades won’t show up in open interest data until tomorrow, the 1100 put already saw open interest increase by 1,961 contracts overnight, reaching 4,881 as of this morning. This large overnight jump suggests the contract is a focal point for both new and existing risk positions — traders have been adding to these puts before the stock’s sell-off.
New Licensing Deal Provides a Fundamental Backdrop Amid Option Frenzy
This options spike comes as Netflix announced new, industry-first master toy partnerships with Mattel and Hasbro to capitalize on the blockbuster success of “KPop Demon Hunters.” With 325 million views in 91 days and major merchandising moves launching, there’s plenty of fundamental excitement — but the day’s sharp price drop hints that the market may be recalibrating expectations, or that traders are hedging after a powerful run.
Takeaway: IV Drop and High Retail Participation Make the Trade Unusual
The surge in the Oct-24-25 1100 put stands out for its scale, with almost 6% of total option volume concentrated in a single contract by mid-morning — and IV collapsing even as put demand surges. That’s an unusual combination, hinting that option sellers (possibly market makers) are actively supplying puts as retail investors look to protect or bet against the stock.
Given the sudden drop in implied volatility, option pricing looks less panicked than the headline stock move might suggest. Is this a case of the market over-hedging after exuberant headlines — or an opportunity to pick up relatively cheap protection ahead of further news? With more open interest data coming tomorrow, and fundamental shifts still unfolding, NFLX is set to remain a key stock to watch.
Contact Information:
If you have feedback or concerns about the content, please feel free to reach out to us via email at support@marketchameleon.com.
About the Publisher - Marketchameleon.com:
Marketchameleon is a comprehensive financial research and analysis website specializing in stock and options markets. We leverage extensive data, models, and analytics to provide valuable insights into these markets. Our primary goal is to assist traders in identifying potential market developments and assessing potential risks and rewards.
NOTE: Stock and option trading involves risk that may not be suitable for all investors. Examples contained within this report are simulated and may have limitations. Average returns and occurrences are calculated from snapshots of market mid-point prices and were not actually executed, so they do not reflect actual trades, fees, or execution costs. This report is for informational purposes only, and is not intended to be a recommendation to buy or sell any security. Neither Market Chameleon nor any other party makes warranties regarding results from its usage. Past performance does not guarantee future results. Please consult a financial advisor before executing any trades. You can read more about option risks and characteristics at theocc.com.
The information is provided for informational purposes only and should not be construed as investment advice. All stock price information is provided and transmitted as received from independent third-party data sources. The Information should only be used as a starting point for doing additional independent research in order to allow you to form your own opinion regarding investments and trading strategies. The Company does not guarantee the accuracy, completeness or timeliness of the Information.
Disclosure: This article was generated with the assistance of AI