Put seller calls floor in Sigma-Aldrich

optionMONSTER

Sigma-Aldrich has been trapped in a range all year, but one trader sees a floor beneath shares of the life-sciences and technology company.

Dominating today's volume is a single print of 5,000 January 65 puts that was 10 times the total daily option average for SIAL. A trader sold the block for the bid price of $0.70 against previous open interest was 261, so it was a new opening position, according to optionMONSTER's systems.

The put selling is a bet that SIAL will remain above $65 though the beginning of next year. Below that level, the trader faces the obligation to buy shares at an effective price of $64.30 with the credit from the put sale. (See our Education section)

SIAL is up fractionally this morning at $70.12. It is bouncing off the low end of the range, as shares have been trading mostly between $68 and $74 going all the way back to early January. It did see its highest close of the year, just above $74, less than a month ago.

More From optionMONSTER

View Comments (0)