Morgan Stanley is rebounding sharply today, and one trader is selling puts in the bank.
MS is up 5.95 percent to $13.81. Two weeks ago it bounced off support after nearly matching 2012 lows just below $12.30. Shares were above $21 in late March.
A trader sold 10,000 October 12 puts for the bid price of $0.45, according to optionMONSTER's systems. The volume outstripped open interest, so this is a new position.
The put seller sees MS holding above the $12 level holding up over the coming months. The trader is not necessarily bullish but apparently believes that the risk premium in the puts warrants the sale. He or she is also willing to buy shares if they are below the strike price at expiration. (See our Education section)
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