At least one trade apparently believes that downside potential is limited in Anadarko Petroleum.
optionMONSTER's monitoring systems show that 2,000 Weekly 50 puts expiring on Sept. 23 were sold in one print for $0.63 today. This is clearly a new position, as open interest in the strike was just 26 contracts before the trade appeared.
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)
APC is up 2 percent to $55.35 in morning trading and 10 percent in the last three months. The oil and gas producer is expected to report earnings after the close on Oct. 25.
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