GameStop puts set for potential pullback
GameStop has rallied sharply in the last month, but a large trade is positioning for a possible drop.
optionMONSTER's tracking program detected the sale of 4,000 September 30 puts for $1.50 and the purchase of 4,000 September 32 puts for $2.50 today. Volume was below open interest in the lower contracts, indicating that a bearish position was rolled to a higher strike that is in the money with a higher delta .
Long puts lock in the price where a stock can be sold, so they make money if shares decline. Investors use them to hedge long positions or to speculate on a drop. (See our Education section)
GME is up 1.91 percent to $31.72 in morning trading and is up 18 percent in the last month. The game retailer's last quarterly report on May 26 was bearish, and its next set of numbers is estimated for release after the close on Aug. 25.
More From optionMONSTER
