Show of support in Plains All American
Investors apparently believe that Plains All American Pipeline is on solid ground.
optionMONSTER's market scanners show that 5,000 June 23 puts were sold for $0.93 yesterday. Volume was more than 6 times the open interest in the strike, indicating that this is new positioning.
Short puts lock in a price where investors must buy a stock, while letting them collect premium. Traders use the technique when they like a stock and think that the risk of a big drop is limited. (See our Education section)
PAA fell 2.42 percent to $23.35 yesterday but is up 21 percent in the last three months. The oil and natural-gas pipeline operator beat earnings estimates but fell short on revenues on May 4.
Overall option volume was about average in PAA yesterday.
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