Learn the trade here. Make it on tradeMONSTER

Options Trading News

August 24, 2012  Fri 11:58 AM CT

PHH: SEE CHART GET CHAIN FIND STRATEGIES
Mortgage servicer PHH is near its 2012 highs, and bearish spread dominates the options action.

The trader bought 1,815 January 15 puts for $1.05 ask price and sold the same number of the 10 puts for the bid price of $0.15. The volume at both strikes was more than open interest so this was a new opening put spread.

It cost $0.90 to open, with a maximum profit of 455 percent if the stock closes at or below $10 on expiration. The initial outlay is all they can lose if it doesn't drop.

PHH rose 0.79 percent to $17.89 in late morning trading. It made a 2012 closing high of $18.31 last week, and appears to have significant support around $15.

Total option volume is 14 times greater than average, with that spread accounting for the entirety of the action.
Share this article with your friends


TRADING WEEKLY OPTIONS

The fastest money in the market
View full report »

Premium Services

Education & Strategy

Options and high-frequency trading

There has been much talk lately of high-frequency trading (HFT) and what it does--or doesn't--mean to the markets and retail...

View more education articles »
optionMONSTER stockMONSTER tradeMONSTER