Podcast Summary: The Indicator from Planet Money

Episode: Do traders who place big bets make big money?

Date: February 24, 2026
Hosts: Waylon Wong (NPR)
Guests: Ricky Mulvey (Co-host, This Time is Different), Amy Wu Silverman (Royal Bank of Canada), Mike Koh (Open Interest Pro), Matt Sankom (Unusual Whales)

Episode Overview

This episode delves into the world of “option whales,” the traders and institutions that place massive bets on the stock market using options contracts worth millions—sometimes tens of millions—of dollars. The hosts investigate who these whales are, what motivates their colossal trades, and whether big bets reliably deliver big profits. The conversation highlights not only the mechanics of the options market but also the intrigue and suspicion that arise from outsized trades, especially when these bets coincide with major news events.

Key Discussion Points and Insights

1. Introduction to Option Whales

• Definition: Option whales are individuals or institutions that place extremely large options trades, betting on the future price of stocks or other assets.
• Nature of the Bets: “They're not necessarily buying a stock itself. They're buying the right to buy an asset, like a stock... It's essentially a bet on what the price will be within that timeframe.” — Ricky Mulvey (00:31)
• Scale: Recent examples include a $74 million single bet on one stock.

2. The Boom in Options Trading

• Phenomenal Growth: U.S. options trading volumes tripled from 5 billion contracts in 2019 to over 15 billion by last year (03:40).
• Market Evolution:
  • There are now weekly and daily options contracts, versus longer one to three month terms in the past.
  • This allows whales and other traders to speculate with much shorter windows (04:14).

3. Why Institutions Use Options

• Risk Management:
  • Large investors (like pension funds) use options to hedge against catastrophic losses, essentially “buying insurance” against a market crash—ensuring they can sell at a preset price if the market drops (04:21–04:37).
  • “They think about their portfolios that way because for a lot of institutions, that money that they're protecting is one day going to be for someone's 401k or someone's pension plan, and they have to make sure that it's there.” — Waylon Wong (04:45)
• Complex Strategies:
  • Professional whales may run multiple option strategies on the same stock, not always seeking to “pick winners” but to juggle risk and squeeze out income (05:33–05:48).
  • “As traders, we are not… thinking about what this person is doing. We're really thinking about just numbers... this is completely algorithmic.” — Mike Koh (05:48)

4. Spotting Unusual Whale Behavior

• Tools for Detection:
  • Matt Sankom, CEO of Unusual Whales, explains how spikes in option activity can signal unusual interest or possible information advantages (06:31).
  • “Imagine a restaurant in a quiet neighborhood that all of a sudden has a line out the door. Seems like something might have changed, right?” — Matt Sankom (06:38)
• Not All Whales Do Research:
  • Sometimes, as with a $74 million bet on Taiwan Semiconductor, the “whale” appears to be a non-institutional trader who simply picked a direction and lost—wrongly assuming size equates to insight or research (07:34–07:48).
  • “It mostly appears that this guy picked a direction very confidently and was wrong.” — Matt Sankom (07:41)

5. Options and Insider Information

• Highly-Timed Bets:
  • Some winning whale trades are timed eerily close to major political announcements, raising suspicions of insider information (08:08).
  • Example: “Right before the announcement about that tariff pause, somebody placed a large bet the S&P 500 would go up in value. And they were right… Those lucky ducks made close to $200 million.” — Ricky Mulvey (08:31–08:40)
  • “So it's almost as if maybe someone knew he was about to pause this thing. Now we don't know for sure, and we can't know for sure.” — Matt Sankom (08:44)
• Political Conflicts:
  • US lawmakers can legally trade stocks and options, raising concerns about conflicts of interest, especially when trades overlap with their legislative oversight (09:10–09:20).

6. Calls for Reform

• Legislative Proposals:
  • The "Stop Insider Trading Act" and the "Restore Trust in Congress Act" seek to restrict Congress members and their families from trading stocks and options, but neither is law yet (09:29–09:48).

Memorable Quotes and Moments

• "I decided that I must find one, any whale for this story... no matter the physical or mental cost, no matter how many seas I had to cross." — Ricky Mulvey (01:19)
• “Well, call me Ishmael. Today on the show, we are going inside the world of option whales.” — Waylon Wong (01:39)
• “We trade 8 million contracts a week on about 100 stocks.” — Mike Koh (05:33)
• “Sometimes the timing raises questions, especially in the world of politics.” — Waylon Wong (09:10)
• “They're more likely to invest and trade in stocks where they sit on a committee that regulates those industries.” — Matt Sankom (09:20)

Notable Segment Timestamps

• 00:31: Ricky Mulvey explains what options and option whales are.
• 03:40: Data on the boom in options trading since 2019.
• 04:21–04:45: Institutional use of options as insurance.
• 05:33–05:48: Mike Koh on complex, algorithm-driven trading by whales.
• 06:38: Metaphor for detecting suspicious trading activity.
• 07:12–07:48: Breakdown of the $74 million failed bet.
• 08:08–08:44: Links between political events and profitable whale options bets.
• 09:10–09:48: Discussion about insider trading and proposed legal reforms.

Tone & Style

• The episode uses playful, literary references (Ahab, Ishmael) while injecting a sense of investigative curiosity and skepticism.
• The hosts blend clear explanations of financial concepts with humor and memorable analogies to keep complex material accessible and engaging.

Conclusion

This episode peels back the curtain on the “whales” of options trading, revealing that even the biggest, boldest bets often don’t pay off—unless timed with privileged information. Beneath the splashy headlines, most whale trades are driven by institutional risk management or impersonal algorithms, but the potential for abuse and insider advantage remains, especially among the politically connected. The episode leaves listeners with a sense of the market’s dynamism, intrigue, and the need for greater oversight.