How volatility trade is playing Fidelity


One trade makes up all of today's option volume in Fidelity National Financial and appears to be looking for another pop in volatility.

optionMONSTER systems show that a trader bought 5,000 December 20 puts for the ask price of $0.75 on a relatively wide bid/ask spread. The volume compares to a total daily average of 750 and previous open interest of 661 contracts at that strike.

Less than a minute later, FNF's largest block of stock traded as 100,000 shares were bought for $23.95. Combined with the puts, this creates a delta-neutral play that is looking for higher volatility in the stock. (See our Education section)

FNF is down 0.9 percent to $23.71 today and has been in a tight range in the last couple of weeks. The insurance and mortgage company posted an intraday high of $27.17 at the end of May and bounced off support near $22 in late June.

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