Bears target Gap for fast money

By
A A A
Share |

Traders are bracing for another weak number when Gap reports monthly sales two days from now.

optionMONSTER's Depth Charge monitoring system detected the purchase of some 4,100 Weekly 36 puts, which expire at the end of Friday's session, for $0.35 to $0.40. Volume exceeded open interest of 3,247 contracts, indicating that new positions were initiated.

These puts lock in the price where the retailer can be sold, so they can increase in value if the stock falls. Investors use them to speculate on a drop or to hedge long positions against a pullback. (See our Education section)

GPS is up 0.21 percent to $37.31 in midday trading. It went on a huge run between early 2012 and last August with a rally of 150 percent but has been drifting lower since and gapped lower on Oct. 11 after reporting that same-store sales declined 3 percent in September. Analysts had expected a gain of 1.6 percent. The next release follows the closing bell on Thursday.

Total option volume is twice the daily average in GPS, according to the Depth Charge. Puts outnumber calls by a bearish 6-to-1 ratio.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.


This article appears in: Investing , Options

Referenced Stocks: GPS

optionMONSTER

optionMONSTER

More from optionMONSTER:

Related Videos

Stocks

Referenced

75%

Most Active by Volume

152,099,280
  • $16.13 ▼ 1.59%
76,450,549
  • $59.72 ▲ 1.07%
57,375,391
  • $36.35 ▲ 6.26%
50,140,425
  • $26.93 ▲ 0.60%
49,201,544
  • $3.17 ▲ 2.59%
39,533,031
  • $86.18 ▲ 1.33%
36,760,050
  • $13.42 ▲ 2.84%
33,109,047
  • $26.12 ▲ 1.16%
As of 4/16/2014, 04:05 PM