Why Ebix traders are selling puts
Mike Yamamoto | [email protected]
More than 2,800 October 9 puts were sold yesterday, mostly for $0.40, according to optionMONSTER's tracking systems. The volume was more than twice the strike's previous open interest, indicating that new positions were established.
These put sellers are looking for EBIX to stay above $9 through expiration in mid-October. If it falls below that strike price, the traders will face the obligation to buy shares at that level. (See our Education section)
EBIX was up 0.5 percent yesterday to close at $9.96. The controversial insurance-software company came into September at $11.55 but has been trending lower since, falling below its 50-day moving average along the way.