Ferrellgas has been dropping, and one bear wants to ride the
optionMONSTER's Depth Charge tracking system detected the purchase
of 2,000 February 17.50 puts for $3.60 and the sale of an equal
number of November 17.50 puts for $1.90. Volume was below open
interest in the November options but not in the February puts,
indicating that an existing position was rolled from one contract
to the other.
FGP is up 0.22 percent to $15.74 in morning trading but has lost 12
percent of its value in the last month. The propane stock is now
below the $17.50 strike price, leaving those puts
in the money
. Given that they expire today, the investor rolled the trade to
prevent themselves from being assigned a short position in the
Instead, the trader will remain exposed to further downside in the
stock, but with limited risk to suffering losses in the event of a
rally. Adjusting the trade cost $1.70. (See our
section for more on how trading options can be safer than buying
and selling shares.)
FGP normally trades fewer than 700 contracts in a session, but
volume is almost 6 times that amount already today. Puts outnumber
calls by more than 1,000 to 1, according to the Depth Charge.
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.
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