Alibaba closed at $110.63, down 0.15%.

Options flow showed a dominant bearish tone, highlighted by a $3.54 million in-the-money put purchase. The 1,864-contract September 25, 2026 $130.00 put trade stood out against a backdrop of neutral implied volatility, indicating that institutional traders were paying up for downside exposure despite the stock’s modest daily decline. With no offsetting bullish block trades, the large-order activity leaned clearly toward protection or outright bearish speculation.

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Options Indicators

Alibaba’s implied volatility is 43.75%, and with an IV percentile of 33.07%, current option pricing sits in the neutral zone rather than at an extreme. Volatility is not especially cheap, but it is also not elevated enough to suggest options are richly priced. The IV/HV ratio of 1.24 indicates implied volatility is running moderately above historical realized volatility, suggesting the market is assigning a somewhat higher premium to forward uncertainty than what the stock has recently delivered. The Call/Put volume ratio is 2.37.

Large Trades

A put buy worth $3.54 million stood out as the key large trade, with 1,864 contracts purchased in the September 25, 2026 $130.00 put. With BABA referenced at $111.22, this put was in the money at the time of the trade, which makes it a more defensive and conviction-heavy bearish position rather than a low-probability downside lottery ticket. The buyer was positioning for continued weakness or seeking meaningful downside protection, using an in-the-money long put to gain negative directional exposure with substantial sensitivity to further declines in the stock.

Overall, the large-trade flow was clearly bearish. The only displayed bulk order was a sizable in-the-money put purchase, which points to either outright downside speculation or active hedging against further stock weakness, and there was no offsetting bullish large-trade activity in the dataset. Taken together, the tone of the block flow suggests cautious to negative institutional sentiment on BABA, with traders willing to pay meaningful premium for downside exposure rather than expressing confidence in a rebound.

Strategy Reference

For a lower assignment probability, a premium seller could consider the $100.00 strike put, which sits well below the $110.63 close and shows a delta consistent with a lower likelihood of expiring in the money, while traders seeking to limit margin requirements may prefer a bear put spread using the $130.00 and $100.00 strikes.