Credit: Shutterstock photoCNO Financial has gotten hit hard, and one investor is throwing in the towel.
optionMONSTER's monitoring programs detected the sale of about 5,300 October 6 calls for $0.20 against open interest of 1,332 contracts. The trade reflects a belief that upside will be limited in the insurance stock until expiration in 4-1/2 weeks.
The calls may have been written by an investor who owns shares , in which case they are expressing a willingness to unload if they go back above $6. Including today's credit, the trader would receive a selling price of $6.20.
They could have also been sold as a speculative short position, though that is less likely because it would put the trader at risk of unlimited losses if CNO manages to rally. (See our Education section)
The stock is up 2.27 percent to $5.86 in morning trading today but has lost one-quarter of its value since late July. Consistently strong results have done little to sway investor sentiment.
CNO has also dropped after slamming into its 30-day moving average in late August, which could make some chart watchers believe it continues to face resistance.
Overall option volume is 8 times greater than average so far today.
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.
