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Barrick Gold draws vote of confidence

One big investor thinks that Barrick Gold is on solid ground.

optionMONSTER's monitoring programs detected the sale of about 9,400 January 46 puts against open interest of 7,950 contracts. Most of the large blocks priced for $1.95.

The trade reflects a belief that the gold miner has only limited downside over the next two months. If it stays above $46, the investor will keep the premium and the puts will expire worthless. Below that level, he or she will have to buy the shares for $46. But including the credit earned their entry price would be $44.05.

Investors often sell puts when they like a stock but don't want to expend capital getting long. Today's trade also seems to be based on ABX holding support at the same $48 level where it peaked in early October. (See our Education section)

ABX is down 0.46 percent to $47.74, pulling back from earlier gains.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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