Options Trading News

July 30, 2013  Tue 3:16 AM CT

One trader sees limited downside in MetLife well into next year.

optionMONSTER systems detected the purchase of 5,000 January 40 puts for $1.02 against previous open interest of 12,000. A the same time, 5,000 March 40 puts were sold for their bid price of $1.44 in volume far above the open interest of just 13 contracts at that strike, so it is clearly a new position.

This could be a short calendar spread, but such trades make money if shares move away from the strike price and are therefore usually done at the money. So this appears to be a short-put roll with the trader closing the position in January and getting short the puts in March, looking for MET to stay above $40 through the new expiration. (See our Education section)

MET was down 0.65 percent to $48.61 yesterday. The insurer hit $49.86 last week, its highest price since October 2008. Shares were last below $40 in early May and haven't looked back since.

Total option volume in the name was 17,341 yesterday, 3 times its daily average in the last month.

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