With the impressive gains Rivian Automotive (NASDAQ: RIVN) has experienced in the pre-market by adding almost 50% to its price, the news has quickly gripped the EV investor community.
However, it seems that RIVN stock has already been the victim of insider trading. A single trader bought $14 call options and $13 call options, both set to expire on June 28.
If Rivian’s stock, currently trading at $16.95 in the pre-market, maintains its upward momentum, the holder of these options stands to make substantial profits that measure in millions from his initial investment of $16,000.
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If the pre-market gains hold and extend even further until the June 28 deadline, the profit will multiply exponentially.
RIVN stock short-sellers haven’t been so fortunate
On the other hand, the RIVN stock surge has caused millions of dollars worth of losses to short sellers, with a high interest of 18.85 % in Rivian shares and an average coverage of 4.48 days, meaning that most of them got liquidated.
Additionally, this high level of short-seller activity combined with a sudden stock surge could lead to a potential short squeeze of RIVN stock, pushing its price up even further.
RIVN shares weren’t so attractive to insiders in the past year
Considering the lackluster performance of RIVN stock since the start of 2024, where it lost 43% of its value, it is understandable that during the past six months, there have been only seven sales for a total of 128,945 RIVN shares that have been worth just over $1 million.
But now, with the EV maker stock on the rise again, it is worth keeping an eye on any additional insider activity that may occur, as it may signal a potential top for its price.
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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
