U.S. Airways has been trending higher, and one investor is
hedging the name.
optionMONSTER's Depth Charge monitoring system detected the sale of
10,000 February 12 puts for $0.03 and the purchase of an equal
number of February 13 puts for $0.15. Volume was below open
interest in the 12s, indicating that an existing position was
rolled to the higher strike.
The investor probably owns shares in the airline and has been using
as a hedge
. Adjusting the trade let him or her raise by $1 the level at which
they have protection at a cost of $0.12. (See our
section for more on how options can be used to manage risk.)
LCC is up 0.63 percent to $14.39 in early afternoon trading and has
risen 71 percent in the last year. The stock is sitting around the
same $14.50 level where it peaked in July, which could be leading
some chart watchers to expect a big drop if support gives way.
Total option volume is almost twice the daily average so far in the
session, with puts outnumbering calls by more than 5 to 1.