One investor is worried about Weyerhaeuser.
optionMONSTER's Depth Charge tracking system detected the purchase
of some 22,000 January 20 puts, most of which priced for $2.75.
Volume was more than 20 times open interest in the strike, clearly
showing that this is a new position.
The puts will appreciate if the forestry and paper company drops in
the next 11 months. They were probably bought by an investor who
owns the shares and wants to hedge against a decline.
WY rose 3.58 percent to $20.57 yesterday and is up 23 percent in
the last two months. It gapped higher after a strong earnings
report on Feb. 3 but then pulled back. The stock has spent the last
month attempting to consolidate above its 200-day moving average
following a selloff last summer, which some chart watchers may
consider a bullish sign.
Overall option volume in WY was 6.5 times greater than average
yesterday, with puts outnumbering calls by 14 to 1.
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