St. Jude Medical is pulling back, but one investor apparently
thinks that the stock is on solid ground.
optionMONSTER's tracking systems detected the sale of about 2,800
October 35 puts for $2 and 1,100 October 30 puts for $0.85. There
was barely any open interest in either strike before the session
The trades occurred less than five minutes apart, suggesting that
they were the work of single investor. He or she is now obligated
to buy shares in the medical-device company if they close at $35
and $30 on expiration. Above those respective levels, the contracts
will expire worthless and the the seller will keep the premium.
STJ is down 3.39 percent to $39.91 in midday trading. It rallied
from below $33 in mid-December to near $44 last month but has been
falling since. The stock now seems to be finding support around its
50-day moving average, the same level where it peaked late last
That technical setup could be leading some investors to believe
that support is in place, providing confidence that downside will
be limited. Investors often
when they like a stock because it lets them make money without
spending capital. (See
by Chris McKhann)
Overall option volume in the name is triple the daily average so
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.