Bears fear pullback as Zimmer lags

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Zimmer Holdings has been lagging, and investors are getting nervous.

optionMONSTER's Depth Charge monitoring program detected the purchase of 2,800 April 70 puts for $0.40 against open interest of just 291 contracts. The trade dominated activity in the medical-products company today, which normally trades about 250 contracts per session.

Those puts lock in the price where investors can sell shares, making them inversely correlated with the stock. They have the potential to generate big profits if ZMH drops, so the buyers could be using them to insure a long position in the company. (See our Education Section for other hedging strategies.)

ZMH rose 0.78 percent to $73.29 in late morning trading, and is up percent in the last year. It's down since late January, however, despite gains in the broader market. That could make some traders think it's losing favor among buyers.

Puts outnumber calls by a bearish 49-to-1 ratio in the stock so far today, according to Depth Charge.

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