Market News

January 23, 2013  Wed 9:26 AM CT

Kinross Gold has been in a tight range for months, and option traders are looking for more of the same.

optionMONSTER systems show that just over 10,000 August 8 puts have traded against previous open interest of 1,103 contracts. The biggest block of 6,848 was sold for the bid price of $0.30.

The put selling is a bet that KGC will be above $8 through that August expiration. If the stock is below that strike price, traders will face the obligation to buy shares. (See our Education section)

KGC is down 2.13 percent to $9.66 this morning. The Toronto-based miner has been trading between $11 and $9 since the start of September.
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Using puts to BUY stock

Puts are an options contract that gives buyers the right to sell their stock for a set price on or before a future date. However, puts can also be an effective way to BUY stock.

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