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• ACHN 100% Rate It

Achillion Pharmaceuticals has been ripping higher, and one investor wants to protect the gains.

optionMONSTER's Depth Charge monitoring program detected the purchase of 3,000 October 10 puts for $0.65. Volume was almost twice previous open interest at the strike.

Owning those puts ensures a minimum sale price of $10 on the drug developer, so they will become more valuable if the shares push lower. That provides the investor with insurance so he or she can stay long following the stock's blistering run. (See our Education section for other hedging strategies.)

ACHN is up 4.32 percent to $10.74 this morning and more than 60 percent in the last month. Sentiment has brightened dramatically toward the name since the summer as investors have focused on the promise of its prospective hepatitis C treatment.

Overall option volume is triple the daily average so far today, with puts outnumbering calls by 11 to 1.

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