Paid Options Alerts Trigger Price Surges That Quickly Fade

Buying surged after paid options alerts, and the recommended contracts rose sharply before most of the price impact faded within roughly two hours, a study of 15 Discord trading communities found. Retail activity after alerts reached roughly 14.5 standard deviations above normal. The recommended options rose an average of about 3% during the first minute. After transaction costs, subscribers generally lost money even when they acted almost immediately. “The finfluencer generally would get in at a lower price, and then the herding of their followers pushes the price up,” Brian Roseman, a finance professor at Oklahoma State University, said.

Source: TokenPost