Bears are shopping at L Brands before the retail company reports
same-store sales on Thursday morning.
optionMONSTER's Depth Charge tracking program detected the purchase
of 3,300 July 49 puts for $0.50 to $0.60. Volume was triple the
previous open interest at the strike, indicating that new trades
Puts lock in the price where shares can be sold, which gives them a
potentially strong inverse relationship with the stock. Investors
buy them to speculate on drops or to
protect long positions
against declines. (See our
LTD rose 1.41 percent to $50.37 yesterday. It gained more than 900
percent between March 2009 and May 2012 but has been shuffling in a
range since. Formerly known as Limited Brands, the company's labels
include Victoria's Secret and Bath & Body Works.
Same-store sales growth missed expectations in the last two months,
and yesterday's option activity suggests that at least one big
investor is worried about another weak number later this week.
Overall option volume was 15 times greater than average in the
session, according to the Depth Charge. Puts accounted for a
bearish 92 percent of the total.
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