OptionsHouse

Options Trading News

January 14, 2013  Mon 2:45 AM CT

ANR: SEE CHART GET CHAIN FIND STRATEGIES
Shares of Alpha Natural Resources fell for four straight days last week, but heavy option volume in the coal producer was topped by put selling on Friday.

More than 37,400 ANR options changed hands the day, nearly double its daily average of 19,000. optionMONSTER systems show that 7,500 June 7 puts were sold at the bid price of $0.51 against open interest of fewer than 300 contracts, clearly a new position.

A minute later 135,000 ANR shares traded for $9.4944. It is possibly that the stock and options were tied together as a delta-neutral strategy, or the short puts could have been making a straightforward bet that ANR will remain above $7 through the June expiration. Either way, the trader isn't expecting a big drop in shares in the next five months. (See our Education section)

ANR finished the week at $9.55, down 2.25 percent on Friday after losing in the previous three sessions. The stock had reached an intraday high of $10.74 on Monday, more than double its 52-week low of $5.28 from early September.
Share this article with your friends


OptionsHouse

TRADING WEEKLY OPTIONS

The fastest money in the market
View full report »

Premium Services

Education & Strategy

Market Level Making You Nervous, Huh? Part 3

In last week's article, we discussed how important the extra cash you save by using the Stock Replacement Strategy over buying the actual stock is! That extra cash in our account instead of being unnecessarily tied up in a stock position allows us to buy the puts we would need to protect our downside in the case of a major sell-off.

View more education articles »