1
What makes a trade unusual
Volume well above open interest, large premium (often $500K+), and short-dated contracts are the classic tells. Volume above open interest suggests new positions, not closing trades.
2
Sweeps vs blocks
A sweep splits an order across many exchanges at once to fill fast — urgency. A block is a single large, privately negotiated print. Sweeps paid at the ask suggest a buyer; at the bid, a seller.
3
Read the side, not just the size
A huge put trade could be a bet on a drop — or a hedge on a large stock position. Check whether it was bought or sold, the expiry and whether it lines up with an event like earnings.
4
The Najarian approach
Follow size and conviction, but use defined risk and a position small enough that being wrong is fine. Many unusual trades are hedges that lose money on purpose.
Common mistakes
- Assuming every big call buyer knows something.
- Copying a whale trade without knowing if it was opening or closing.
- Ignoring that institutions hedge — their loss may be your full loss.