OptionsHouse

Options Trading News

April 12, 2013  Fri 10:14 AM CT

JPM: SEE CHART GET CHAIN FIND STRATEGIES
A big put trade tops the options activity in JP Morgan even though shares are showing minimal reaction to its earnings announcement this morning.

optionMONSTER's Depth Charge system shows that a trader sold 21,000 May 48 puts for $0.65, less than the bid price listed, in volume well above the previous open interest of 7,041. Seconds later, he or she bought 24,442 April 48 puts for the ask price of $0.17. The open interest at that strike was more than 33,000, so that could have been an opening or closing trade.

If it was an opening trade, this is basically a calendar spread set to profit if JPM is around $48 at the end of next week. But it is more likely a roll, with the trader moving a short-put position out a month as the April options have lost most of their value and will expire in a week. (See our Education section)

JPM is down fractionally at $48.97 this morning. The financial giant was at a high of $51 a month ago and tested support at $47 last week.

More than 180,000 JPM options have already changed hands so far, compared to a daily average of 73,000.
Share this article with your friends


Related Stories

JPM

Traders bet JP Morgan will hold ground

April 26, 2016

Traders apparently believe that downside potential is limited for the banking giant, which has risen 14 percent in the last three months.

OptionsHouse

TRADING WEEKLY OPTIONS

The fastest money in the market
View full report »

Premium Services

Education & Strategy

Market Level Making You Nervous, Huh? Part 3

In last week's article, we discussed how important the extra cash you save by using the Stock Replacement Strategy over buying the actual stock is! That extra cash in our account instead of being unnecessarily tied up in a stock position allows us to buy the puts we would need to protect our downside in the case of a major sell-off.

View more education articles »