Protection in place for United Tech


Someone is slapping protection on United Technologies with the aerospace stock pennies below its record high.

optionMONSTER's Depth Charge monitoring system detected the purchase of 4,000 November 90 puts for $1.47 and the sale of an equal number of November 75 puts for $0.33. Volume is more than 6 times previous open interest at both strikes.

Known as a bearish put spread , the trade cost $1.14. It will earn more than 1,200 percent if the aerospace stock falls to $75 or lower on expiration. (See our Education section)

UTX is up 0.31 percent to $100.14 in morning trading, and is up 22 percent so far this year. The shares hit an all-time high of $100.70 on Friday before pulling back to close below $100, which could make some chart watchers believe that they're topping out for now.

The stock troughed around $75 in November before launching on its current run, and today's spread is looking to that level as potential support in the event of a drop. Earnings come out next Tuesday, July 23, before the opening bell.

Total option volume is triple the daily average so far today, with puts outnumbering calls by more than 4 to 1.

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