Options Trading News

May 18, 2012  Fri 9:28 AM CT

One investor thinks that JetBlue Airways will hold its altitude for the rest of 2012.

optionMONSTER's tracking programs detected the sale of 2,560 December 4 puts for $0.50. Volume is more than 300 times open interest in the strike.

The stock doesn't need to take off for the position to make money--it simply must avoid a crash below $4. If the shares hold that level, the puts will expire worthless and the investor will keep the credit. Even if the stock goes below $4, the income received will protect the trader down to $3.50. (See our Education section)

JBLU is down 1.44 percent to $4.11 in morning trading and has lost 29 percent of its value in the last three months. That decline has pushed up implied volatility to 50 percent from the 41 percent historic level, which also favors the put seller because it suggests that options are overpriced.

More than 2,700 contracts have traded so far this morning, pushing total volume to almost twice the daily average.
Share this article with your friends

Related Stories


Notable option activity in equities

November 4, 2015

Nearing the halfway mark in today's session, here are the individual equity names with unusual option activity on optionMONSTER's ActionTracker data system.



The fastest money in the market
View full report »

Premium Services

Education & Strategy

The art of trading

As I stated in last week's article, a break out or a break down needs to have a couple things happen before it is considered a confirmed break out or break down. The only problem is that in today's market where things move much more quicker than they did just a few years ago, two days could wind up being the majority of the expected movement, if not the whole movement.

View more education articles »