Markets
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David Crowther & Luke Kawa

Opendoor surges after trading firm Jane Street reveals 5.9% stake

Shares in retail darling Opendoor Technologies are 8% higher in early trading on Thursday after proprietary trading firm Jane Street revealed a 5.9% stake in the company in a new filing, equivalent to beneficial ownership of more than 44 million shares. At current prices, that’s a position worth $390 million and change.

Many Opendoor bulls are cheering this announcement as vindication from a major institution and a material positive catalyst for the online real estate company. The reality is much less clear and considerably more nuanced. Jane Street is a firm that specializes in market-making and holds a 5% stake or more in 221 US publicly traded securities, per Bloomberg data. It is impossible to know what Jane Street’s true net Opendoor exposure is, since its options positions are not disclosed. No one but Jane Street knows that.

If we had to make an educated speculation, this stock position is much more likely to be a hedge related to calls Jane Street may have sold on Opendoor than it is a plain vanilla expression of optimism on the company’s prospects.

(There is a certain irony that, in this scenario, traders’ reaction to the revelation of a hedge serves as something that immediately makes that hedge more useful!)

The stake is owned by a number of different Jane Street Group subsidiaries. Jane Street Capital reported owning about 3.2 million shares; Jane Street Global Trading reported owning 17.2 million shares; while Jane Street Options, LLC, was reported as the beneficial owner of the bulk of the stake, equivalent to 23.6 million shares. A little over one-third of the stake, 15.5 million shares, were reported as “acquirable through conversion of convertible bonds held.”

Opendoor’s stock has whipsawed in recent days as large shareholders have exited some of their positions. Indeed, just yesterday it came to light that Access Industries, one of Opendoor’s top shareholders, had sold nearly $100 million of OPEN on Tuesday.

Separately, data out yesterday revealed that “sales of newly built homes rose a much larger-than-expected 20.5% in August compared with July,” per CNBC, which might have contributed to positive sentiment on the stock, which gained 16% yesterday.

As of 5 a.m. ET, the stock was the ninth-most-traded in the United States, with heavier volumes (in dollar terms) than tech giants Oracle, Google, and fellow retail favorite Palantir.

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markets
Max Knoblauch

United beats Q1 earnings and revenue estimates, lowers full-year profit guidance amid surging jet fuel prices

United Airlines reported its first-quarter earnings results after the bell on Tuesday. The carrier’s shares ticked down in after-hours trading.

For Q1, United reported:

  • Adjusted earnings of $1.19 per share, compared to the Wall Street estimate of $1.08 per share compiled by FactSet.

  • $14.6 billion in revenue, compared to the $14.39 billion consensus estimate.

In the first quarter, United’s fuel expense grew 12.6% from the same period last year to $3.04 billion.

For the second quarter, United expects adjusted earnings per share of between $1 and $2, shy of Wall Street expectations of $2.08. For the full year ahead, United said it expects earnings between $7 and $11 per share, compared to its prior guidance of between $12 and $14 per share.

“Guidance assumes United’s revenue recovers 40% to 50% of the fuel price increases in the second quarter, 70% to 80% of the fuel price increases in the third quarter and 85% to 100% of the fuel price increases in the fourth quarter 2026,” read the company’s investor update.

Earlier this month, United was among the first major US airlines to hike its bag fees amid higher fuel costs. Its shares have fallen more than 15% from a February high days before the war in Iran began.

United has also made waves this month following reports that CEO Scott Kirby had floated the idea of a merger with American Airlines to President Trump. A merger between two of the big four airlines would create a true US behemoth, controlling more than a third of the American market. American Air last week said it wasn’t interested in merging with United and hadn’t held talks on the idea. On Tuesday, Trump told CNBC that he doesn’t like the idea either.

Tasha Matsumoto
4h
Stocks slip as peace prospects dim

Stocks swung from positive to negative as Vice President Vance’s trip to Pakistan for Iran peace talks was canceled.

Grizzly bear growling USA.
markets
Luke Kawa

Hedge funds are following retail traders into the Magnificent 7

Hedge funds are following retail traders into the stocks the masses never stopped buying.

“As we kick off earnings for megacap tech stocks, this stood out: [hedge funds] have started buying Mag7 stocks again this month though positioning remains well below the peak levels seen in early 2016,” wrote Goldman Sachs’ Cullen Morgan.

Goldman PB Mag 7
Source: Goldman Sachs

In early April, JPMorgan strategist Arun Jain noted that retail investors had basically been selling everything but the Magnificent 7 stocks as part of a more cautious stance due to the Iran war.

(Apple has been a long-standing exception to this trend, presumably because retail traders aren’t fond of its hands-off approach to AI.)

JPM Retail flows

Last August, Jain discussed how retail activity tended to “crowd in” institutional buyers in meme stocks, while Goldman’s John Marshall advised clients to piggyback on stocks beloved by retail traders. Speculative, retail-geared assets proceeded to go on a tremendous run that soured in October.

But there are some early indications that a similar bout of speculative fervor is bubbling up once more.

markets
Luke Kawa

POET Technologies surges above $10 for first time in 4 years amid explosion in call volumes

POET Technologies is up nearly 40% this week as options market activity goes haywire in a faint echo of what got the stock on retail traders’ radars in October.

As of 11:12 a.m. ET, more than 10 calls have changed hands for every put traded. This bullish impulse has propelled the stock above the $10 threshold for the first time since March 2022.

Shares of the optical communications firm briefly dipped last week after Wolfpack Research said it was short the company because its investors would be exposed to an “IRS tax nightmare.”

The company responded that day saying it was taking measures for US shareholders that “should mitigate certain potential adverse US federal income tax consequences to it that could otherwise result from the Company’s status as a passive foreign investment company.”

Luke Kawa
9h
The parabolic surge in Avis reached new heights, with shares halted for volatility

More motivated buyers than motivated sellers.

Travelers at Sacramento International Airport (SMF)

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