Options Trading News

April 18, 2013  Thu 3:47 AM CT

A large put trade topped yesterday's option activity in Morgan Stanley before its first-quarter report this morning.

optionMONSTER systems show that a trader bought 22,805 October 20 puts for $1.45 and sold the same number of October 15 puts for $0.29. The volume was multiples of the previous open interest in each strike, clearly showing that this is new activity.

This bearish vertical spread cost $1.16 to open, which is the trade's maximum potential loss. The maximum gain of $3.84 would be realized if MS is below $15 at the October expiration. (See our Education section)

MS was down 1.74 percent to close at $21.47 yesterday. It was as low as $20.86 in the morning at a support level going back to mid-January, when shares gapped higher. The stock climbed to a high above $24 in mid-February.

More than 145,000 MS options traded yesterday, compared to a daily average of 31,000.
Share this article with your friends

Related Stories


Put buying targets Morgan Stanley

November 16, 2015

The investment firm has pulled back since rallying along with other financial names on speculation that the Federal Reserve would raise interest rates in December.


Morgan Stanley seen holding firm

November 10, 2015

The financial firm is down 9.5 percent on the year but has gained 7.3 percent in the last month on rising speculation that the Federal Reserve will hike interest rates.



The fastest money in the market
View full report »

Premium Services

Education & Strategy

The art of trading

As I stated in last week's article, a break out or a break down needs to have a couple things happen before it is considered a confirmed break out or break down. The only problem is that in today's market where things move much more quicker than they did just a few years ago, two days could wind up being the majority of the expected movement, if not the whole movement.

View more education articles »