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August 7, 2013  Wed 2:45 AM CT

Weatherford is trading just shy of its 52-week high, and one trader apparently believes that any pullbacks will be minimal.

optionMONSTER's tracking systems detected the sale of 3,000 September 14 puts at the same second yesterday for $0.44. The volume was well above the strike's open interest of 1,107 contracts before the trade appeared, showing that this is clearly a new position.

This put seller will keep the $0.44 credit as profit if WFT remains above $14 through expiration in mid-September. If the stock falls below that strike price, the trader will be on the hook to buy shares at that level. (See our Education section)
WFT was down fractionally to $14.42 yesterday. The energy-drilling equipment and services provider spiked higher after reporting second-quarter results last Wednesday but is now bumping up against a resistance level at its highs that has been tested several times since May.
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Using puts to BUY stock

Puts are an options contract that gives buyers the right to sell their stock for a set price on or before a future date. However, puts can also be an effective way to BUY stock.

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