A huge trade is betting on a floor beneath shares of Russian mining and steel company Mechel.
optionMONSTER systems show that 20,306 MTL options changed hands yesterday, compared with a daily average of just 1,462 contracts. Almost all of the volume was in a single print.
A trader sold 20,000 May 5 puts for the bid price of $0.35. This is a new position, as there was no open interest at that strike before the trade appeared.
The put sale represents a bet that MTL will hold above $5 through expiration in mid-May. The trader is also on the hook to buy the shares if they are below that strike price. (See our Education section)
MTL rose 3.42 percent to close at $5.44 yesterday, in the middle of its range of the last week. Shares were down at $5.11 last Thursday, near their lows of a year ago, but were up at $5.69 on Friday. The stock traded at $7.50 in the first week of the year.
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