Options Trading News

September 16, 2016  Fri 8:02 AM CT


Ariad Pharmaceuticals has rocketed in recent months, and one trader apparently believes that downside potential is limited.

optionMONSTER's monitoring systems detected the sale of 2,000 October 11 puts in one print for $0.60 yesterday. Volume surpassed the strike's open interest of 1,003 contracts, showing that this is a new position.

Short puts lock in a price where investors must buy a stock, while letting them collect premium. Traders use the technique when they like a stock and think that the risk of a big drop is limited. (See our Education section)

ARIA rose 6.27 percent to $11.70 yesterday and is up 35 percent in the last three months. The drug maker
is expected to report earnings in pre-market hours on Nov. 3.

Overall option volume was 3 times greater than average in the name yesterday.

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