Options Trading News

January 31, 2014  Fri 3:47 AM CT

A large put sale is betting on a floor in shares of Marathon Petroleum through the spring.

optionMONSTER systems show that 4,744 March 77.50 puts were sold for the bid price of $1.05 yesterday. The strike's previous open interest was just 151 contracts, so this is clearly a new position.

The put seller is looking for MPC to hold above $77.50 through expiration in mid-March and for lower volatility than that implied by the options' price. The implied volatility of those put is 33 percent, while the 20-day historical volatility is 28 percent, coming off the high reached before the company's earnings report Wednesday morning. (See our Education section)

MPC rose 1.13 percent to $87.50 yesterday. The oil refiner bounced off support around $82 at the start of the week and was above $91 earlier in the month.
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