A long-term trade is counting on a floor in shares of Burger King.
optionMONSTER's tracking systems detected the sale of 1,500 April 16 puts for $0.45 and $0.40 yesterday. This is a new position, as there was no open interest in the strike before the trade appeared.
The put seller is looking for BKW to stay above $16 for the next eight months, at which time he or she would keep the credit as profit. But if it falls below that strike price, the trader would be on the hook to buy shares at that level. (See our Education section)
BKW was up fractionally yesterday to close at $19.46, at a level that has held as support for the last week. The fast-food chain rose after reporting second-quarter results at the end of July but hit resistance at $20.40 and then drifted lower.
Total option volume in the name yesterday was more 19 times its daily average for the last month. Puts outnumbered calls by 26 to 1.
More From optionMONSTER
- Investment & Company Information
- Burger King