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May 3, 2013  Fri 3:16 AM CT

A bearish strategy led yesterday's option activity in Green Mountain Coffee Roasters

optionMONSTER systems show that a trader bought 4,230 September 45 puts for the ask price of $3.05 and, at the same time, sold the same number of September 65 calls for their bid price of $4.25. This is new positioning, as the open interest at each strike was under 500 contracts before the session began.

This combination trade takes in a credit of $1.20, which will be the profit if GMCR is between the two strikes at expiration. The real profits kick in if shares fall below $45, while the trader is effectively short shares above $65. This could well be a collar trade to protect gains in a long stock position. (See our Education section)

GMCR rose 0.39 percent to $57.31 yesterday. The coffee company has been in a reasonably tight range for the last six weeks, though it did post a 52-week closing high of $58.22 on April 11. Shares were below $18 last July.

More than 29,000 GMCR options traded overall yesterday, compared to a daily average of 8,800.
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