VMware draws bearish position

Chris McKhann (chris.mckhann@optionmonster.com)
October 9, 2013

A large trader is apparently anticipating more losses for IT company VMware.

Just over 20,000 VMW options have traded, 5 times its daily average in the last month. Most of this was volume in a single put trade.

optionMONSTER's Depth Charge system detected the sale of two blocks of 3,000 October 77.50 puts for $2.18 and $2.17 against open interest of 7,213, according to optionMONSTER systems. At the same time he or she bought 6,000 November 75 puts for the ask price of $3.70 against previous open interest of just 379, so that is a new position.

The trader is very likely rolling a put position to a lower strike price and a later date as VMW continues to slide. It may be an outright bearish play or a hedge against long shares. (See our Education section)

VMW is down 0.47 percent to $77.69. It was above $90 three weeks ago and hit a low around $65 in early July.

More From optionMONSTER