Three-way bearish play in Amedisys
Chris McKhann | email@example.com
More than 17,300 AMED options changed hands on Friday, compared to total open interest of just 11,221 and a daily average of 552 contracts in the last month. Almost all of the volume was one three-way spread.
optionMONSTER systems show that a trader bought 4,000 December 11 put for $1.64 and then sold 4,000 each of the December 8 puts for $0.49 and December 14 calls for $1.05. The volume at all three strikes was above the previous open interest, so this is a new position.
The trade cost just $0.10 and is bearish at least down to $8, with a risk of having to sell shares if they are above $14. This could also be a put spread collar, a protective position against long shares that costs very little but provides protection below that $8 level. (See our Education section)
AMED was down 12.69 percent on Friday to $11.60. It was as low as $9.51 right at the open and then recovered some from there.