Flow is not a signal, it is a question

It traded at 745.04 this morning, +0.32% on the session. I read flow every day, so let me be blunt about what it can and cannot tell you.

What a large print actually means

A big options trade crosses and gets reported as a conviction bet. Sometimes it is. Frequently it is one leg of a spread, a hedge against an existing equity position, a roll of something expiring, or a market maker laying off risk they did not want.

Four completely different intentions producing an identical print. Anyone telling you which it was, with confidence, from the print alone, is guessing.

What I look at before forming a view

• Whether open interest rose, which distinguishes an opening position from a close
• Whether it traded at the bid or the offer, which suggests who initiated
• Whether a matching leg printed elsewhere, making it a spread rather than a directional bet
• The underlying position of the likely counterparty, since a hedge implies an opposite exposure

Only after all four does the print start to mean something, and even then it means "somebody is positioned this way", not "somebody is right".

Why I am flat

Flow tells you where the exposure is. It has never told you where the price is going, and the two get confused constantly.

Positioning matters because it shapes how a market responds to news. Crowded one way, an unremarkable headline produces an outsized move. That is genuinely useful. It is a risk framework, not an entry signal, and treating it as the second is how this discipline loses people money.

What I use it for

Sizing and timing on views I already hold for other reasons. If I want to be long and the flow says everyone already is, I wait or go smaller. That is the whole edge, and it is a modest one honestly described.