In response to the $125 puts for 1/16/2026…assuming this lunatic is a put writer

Edit 2: guys, I think this might be the Kansas City shuffle.

By killing GME’s price, they make these puts more expensive, and when some crazy guy starts writing millions of dollars of expensive puts to them with capped potential profits (currently 28% if GME were to go to $0), they not only have to buy tons of shares to deliver at expiration, but also make up for their premium loss.

Buying the shares makes GME go up. GME going up destroys the put position forced on them by some crazy put writer.

Going over $125 means their obligation to buy shares is over, but their puts go to $0.

Hedging against their premium loss by writing CC’s makes GME go down, which makes their risk, position and average position price go up as some crazy guy keeps writing millions of dollars of puts to them.

When he came back, the stock went high enough to open the chain up to $125. Worm thumps up and down. Each time we go down, he writes more and more puts that market makers need to hedge. They have to run IV up to write expensive calls and smash them down to stay neutral with Vega up their ass. As they run it down, more CSP come rolling through. Over and over.

He is guaranteed 2 outcomes; a share average of $25 or better at expiration if it keeps going down, or insane profit AND guaranteed exit liquidity at $125 over $125 of an entire premium.

And the best part? Because it’s a cash secured put, he’s still accumulating interest on his entire cash position until expiration.

Options 101 “Fine, I’ll do it myself.” Kansas City shuffle.

Original post below:

God this made my brain hurt. Somebody could be writing these and profit like crazy if GME ran. Correct me if im wrong on any of this….i almost had an aneurysm trying to think it through.

BUT check this out. If I’m understanding correctly…

Market maker that buys this put has to hedge accordingly, but how do they hedge theta? They have to WRITE THE APPROPRIATE AMOUNT OF CALLS at similar strike to remain delta neutral. Did anyone notice there’s 17,302 $125 calls open on the other side for that expiration? Ideally the market maker would also buy 100 shares to prepare for delivery of these deep ITM puts. To make up for buying ONE of those puts, market maker has to write 25-30 calls.

1) lunatic writes deep ITM puts 2) market maker buys the put. Market maker’s job is to make the market and provide liquidity. 3) market maker writes equivalent amount of calls to hedge (25-30 calls) OR goes for a vertical or calendar spread, whatever nets them positive theta. Ideally the market maker themselves would write puts close to the strike as well to offset the risk, but we can see that’s not the case based on OI. Why write puts when IV is so bloated still? Easy profit. We can see the 1/16/26 call has 17,302 open interest.

Well, what happens if the stock rises significantly? Oh boy. Put writer gets money, sure. The market maker, however is knee deep in written calls and needs to start buying them back. BUT WHAT IF THEY CAN’T BUY THEM BACK FAST ENOUGH? Who’s writing calls for them to buy back when apes are ham fisted yoloing calls driving vega risk up the wazoo? Have to buy shares now, but at those quantities? Might as well buy calls. That’ll drive the price even higher. If this put writing guy gets out of hand, I can’t even imagine what kind of chaos this would cause if the price were to surge. It hurts my brain trying to understand how market makers actually hedge someone writing deep ITM puts.

This is either a legitimate short or someone is paying big sacrificial money to lay a trap for market makers. That’s my take. It may be wrong because I got crazy confused thinking about it.

Edit: I posted the math below in a comment. Pretty much at $100 per put and 6456 OI, collectively this strike is telling the market maker to either

A) give me $64.5mil for free if the price is $125 and you figure out how to hedge it/make up for it on your own, or B) sell me 645,600 shares for $125 each, total cost to the writer $25/share ($80.7mil collateral - $64.56mil premium) if you keep it under $125 by expiration

And this is just so far. The number keeps growing. The opposite side 1/16/26 $125c only has $4.4mil in premium across 17.3k calls.