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Campbell trader bets that slide is ending

Campbell Soup is at 18-month lows, and one trader appparently believes that the carnage is overdone.

optionMONSTER's tracking programs detected the sale of 11,000 August 32 puts against open interest of just 1,698 contracts. Premiums fell from $0.30 to $0.28 as the transactions crossed, which reflects the strong selling pressure on the puts.

CPB is down 1.34 percent to $32.51 in afternoon trading after touching $32.34 earlier in the session, its lowest price since February 2010. The food company has been increasing its focus on baked goods such as Goldfish and Milano cookies to offset slow soup sales. That helped earnings and revenue beat expectations by a narrow margin the last time results came out on May 23.

The next report scheduled for the morning of Sept. 2.

Today's put seller is looking for CPB to hold its ground in the near term. The position also stands to benefit from the accelerating pace of time decay that will reduce the value of the contracts as expiration approaches. (See our Education section)

The trade pushed overall option volume in the name to 15 times greater than average.

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

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


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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