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May 29, 2012  Tue 3:33 AM CT

OC: SEE CHART GET CHAIN FIND STRATEGIES
Owens Corning rallied last week, but one investor remains wary.

optionMONSTER's Depth Charge monitoring program detected the purchase of 5,000 July 28 puts for $1.14, and the sale of an equal number of June 30 puts for $0.96. Volume was below open interest in the Junes but not the Julys, indicating that an existing position was rolled from one contract to the other.

The investor may be using the puts as a hedge on a long position in the stock or as an outright bearish bet. Adjusting the trade gives them an additional month of downside exposure and prevents them from the quickening pace of time decay that will hit the June contracts as expiration approaches in the next three weeks. It also cost them $0.18. (See our Education section)

OC fell 0.26 percent to $30.57 on Friday but is up 8 percent in the last week. Some traders nearly doubled their money from that move using June 31 calls, as cited by Pete on Monday.

The maker of Pink insulation rallied along with other makers of building materials between October and March but has been dropping since then.

Overall option volume in the stock was 7 times greater than average on Friday. Puts outnumbered calls by more than 28 to 1, according to the Depth Charge.
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