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June 11, 2013  Tue 3:16 AM CT

One big investor thinks HollyFrontier is down but not out.

optionMONSTER's tracking systems detected the sale of 3,960 September 45 puts for $3 and the purchase of an equal number of June 47.50 puts for $1.85. Volume was below open interest in the Junes, indicating that an existing short position was closed and rolled to the lower strike.

The trader probably sold the June contracts at an earlier date, looking for the oil refiner to hold its ground at $47.50. Now that it's fallen below that level, he or she bought the contracts back and adjusted the position to the 45s. This provided an another $1.15 of premium and added three months to the trade. (See our Education section for more on short puts)

HFC declined 1.32 percent to $46.34 yesterday. It roughly doubled between June 2012 and March but has been falling since. The shares are now back near their 200-day moving average, which could be leading some chart watchers to expect support and help explain yesterday's put selling.

Total option volume was almost triple the daily average in the session.
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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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