Unusual trading before Trump announcement yields millions in profits
An unknown trader purchased call options on the S&P 500 index worth $12 million just hours before Donald Trump announced a ceasefire on Tuesday, turning them into $35 million—gaining $23 million in a single day.
The trader bought 6,800 call option contracts on SPX 6950 expiring on May 8, when the index was at 6,556. Following the announcement, stocks rose. Simultaneously, investors sold 8,600 futures lots on Brent and WTI crude oil valued at approximately $950 million prior to the announcement. As a result, oil prices dropped more than 15%, falling below $100 per barrel.
This scenario echoes the events of March 23, when investors sold $500 million worth of oil futures within 15 minutes before Trump announced a delay in sanctions on Iran’s oil infrastructure, which also triggered a 15% price drop.
The information suggests some market players may have access to early information or possess highly accurate analytic models to forecast political events, significantly affecting market prices.
This case raises concerns about trading transparency and potential market manipulation, likely prompting regulatory investigations and tighter trading regulations.
Authorities are expected to increase oversight and improve controls over insider information and market manipulation in response to incidents like this.
