Markets

Bears linger in Temple-Inland

A downside trade on Temple-Inland has worked, and one investor wants another month of protection.

optionMONSTER's Depth Charge tracking system detected the purchase of 10,000 September 22 puts for $1.15 and the sale of an equal number of September 25 calls for $1.60. The exact opposite trade occurred at the same time in August, with the 26 puts sold for $1.20 and the 30 calls bought for $0.05.

The activity appears to result from an existing bearish collar position getting rolled from August to September. It generated a net credit of $1.60 and has the potential to earn infinite profits from continued downside in the maker of cardboard boxes and lumber products.

TIN fell 1.85 percent to $24.97 on Friday and has lost 19 percent of its value in the last month. The stock hit a 3-1/2 year high in July after rejecting a $30.60-a-share takeover bid from International Paper, but then got slammed by sellers when the rest of the market dropped in early August.

Friday's call and put activity may be the work of a shareholder who owns TIN and was using the options for protection. See our Education Section for more.

Overall options volume in the name was 5 times greater than average in the session.

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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