Market News

November 23, 2016  Wed 10:06 AM CT

Traders are positioning for a possible drop in Verizon Communications this week.

OptionMonster's monitoring program shows that 3,200 Weekly 50 puts expiring this Friday were purchased for $0.34 to $0.49 today. Volume was more than 15 times the open interest in the strike, indicating that this is new positioning.

Long puts lock in the price where a stock can be sold, so they make money if shares decline. Investors use them to hedge long positions or to speculate on a drop. (See our Education section)

VZ is up 0.6 percent to $49.78 in morning trading but is down 6 percent in the last three months. The wireless carrier reported bearish results on Oct. 20 and is scheduled to announce its next quarterly numbers in pre-market hours on Jan. 24.

Overall option volume in the name is about average in VZ so far today, with puts outpacing calls by narrow margin.

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