Why H&R Block put volume is surging
Heavy put volume is positioning for a possible drop in H&R Block.
optionMONSTER's monitoring program shows that about 19,600 May 23 puts were purchased for $0.40 to $0.65 yesterday. Volume was more than 28 times open interest at the strike, which indicates new money was put to work.
Long puts lock in the price where a stock can be sold, so they make money to the downside. Investors use them to hedge long positions or to speculate on a drop. (See our Education section)
HRB fell 0.92 percent to $23.82 yesterday and is down 26 percent in the last three months. The tax-preparation service announced bearish results on March 3 and is expected to report its next earnings numbers after the close on June 8.
Overall option volume was 13 times greater than average in the name yesterday. Puts outnumbered calls by a bearish 5-to-1 ratio.
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