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November 29, 2016  Tue 7:16 AM CT

Traders apparently believe that Wyndham Worldwide may have run too far too fast.

OptionMonster's monitoring program shows that 2,000 December 70 puts were purchased mostly for $0.70 to $0.75 yesterday. This represents fresh buying, as open interest in the strike was only 111 contracts before the trades appeared.

Long puts lock in the price where a stock can be sold, so they make money if shares decline. Investors use them to hedge long positions or to speculate on a drop. (See our Education section)

WYN fell 1.62 percent to $73.00 yesterday but is up 17 percent in the last month. The hotel operator is expected to announce quarterly results in pre-market hours on Feb. 7.

Overall option volume in WYN was twice its daily average yesterday. Puts outnumbered calls by a bearish 8-to-1 ratio.

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