Puts show worries over Weyerhaeuser

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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.



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.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.


This article appears in: Investing , Options

Referenced Stocks: WY

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