Alibaba closed at $107.54, a 0.19% decline from the previous close.

The options tape showed large traders favoring premium collection over directional bets. A cross-expiry credit spread generated a $345 thousand net credit, while a deep out-of-the-money short put in the 2027 term added another $243 thousand. Together, these flows point to a moderately bullish stance, with institutions selling downside support and capping near-term upside while volatility remains cheap relative to recent history.

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Options Indicators

Alibaba’s implied volatility is 41.48%, and with an IV percentile of 18.73%, current option volatility sits on the low side relative to its own recent history, indicating that options are cheaply priced rather than expensive. The IV/HV ratio of 1.41 also suggests implied volatility is running above realized volatility, so the market is still embedding a premium for future movement, but overall pricing remains in the relatively inexpensive range given the low percentile reading.

The Call/Put volume ratio is 1.83.

Large Trades

A cross-expiry call-and-put combination with a net credit of $345 thousand was the largest featured trade, and it is best read as a credit-based spread structure rather than a pure synthetic position because it mixes calls and puts across different expirations with both long and short option legs. Specifically, the trader sold the 112.0 call and 100.0 put expiring 2026-10-09, sold the 105.0 put expiring 2026-10-02, and bought the 113.0 call expiring 2026-10-02, with all legs out of the money versus the $107.97 reference stock price. The structure collected premium upfront through a net credit of $345 thousand, suggesting an income-oriented stance with a mildly bullish bias: the short puts indicate willingness to lean long as long as BABA holds above those lower strikes, while the call side caps upside exposure over the short term and leaves the trader positioned for the stock to stay firm without making an outsized breakout.

A single-leg sale of the 80.0 put expiring 2027-01-15 worth $243 thousand was another notable trade, and it was an out-of-the-money short put with a clearly bullish or at least confidence-in-support profile. With the strike well below the current stock price, the seller is effectively betting that BABA will remain above 80.0 through expiration, allowing the option to decay while the trader keeps the premium; strategically, this reflects premium collection and a willingness to accumulate shares at a much lower effective entry level if assigned. Overall, the large-trade flow points to a moderately bullish tone on BABA, as the dominant activity emphasized short-put premium selling and net credit positioning rather than aggressive downside hedging, implying institutional traders see limited near-term downside and are more focused on harvesting premium while leaning for the stock to stay stable to higher.

Strategy Reference

For a low assignment probability premium sale, consider selling the 95.0 or 100.0 put in a nearer expiration; alternatively, a bull put spread such as selling the 100.0 put and buying the 95.0 put reduces margin while aligning with the tape’s moderately bullish premium-collection tone.