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• BC 0% Rate It

Speedboat maker Brunswick has been racing higher, but one investor is worried that a bad earnings report could sink the shares.

optionMONSTER's Depth Charge tracking program detected the purchase of about 2,000 May 26 puts for $1.10 and the sale of an equal number of June 29 calls for $0.65, resulting in a net cost of $0.45.

The position will make money if BC drops in the near term but obligates the trader to sell shares if it goes above $29 over a longer period. He or she probably owns shares and is willing to unload them in the event of a rally.

The strategy resembles a collar but uses different expiration months. The sale of longer-dated calls offset the cost of the puts and tailored the trade to guard against a weak set of numbers this morning. (See our Education section for more on how options can be used to build customized hedging positions.)

BC rose 3.3 percent to $26.90 yesterday and has almost doubled since early October. The last three earnings reports have beaten estimates.

Overall option volume was 10 times greater than average in yesterday's session.

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