$NKE put prices run up overnight

Bearish option traders have run up fast profits in Nike (NKE) today.

Only yesterday afternoon, Market Rebellion’s Unusual Activity Service identified the purchase of 7,600 Weekly $130 puts, expiring Apr. 1, for $0.36 to $1.11 with shares at $137.12. This was clearly fresh buying, as open interest in the strike was only 506 contracts before 70.10activity appeared.

Those puts traded for as much as $5.10 this session, at least 4.5 times their purchase prices. The stock fell 8.32% in the same time frame, illustrating the kind of leverage that can be achieved quickly with options.

Long puts lock in the price where a stock can be sold no matter how far it might drop, gaining value in a selloff with the potential for significant leverage. The contracts can be purchased either as an outright bearish bet or a hedge on a long-stock position.

NKE closed today at $128.64, down 3.39% on the session.