$ADSK bears score big overnight

Autodesk plunged on a weak outlook today, returning exponential profits on downside option positions opened just one session earlier.

Just yesterday, Investitute’s market scanners showed that 2,000 Weekly $126 puts expiring this Friday were purchased for $2.87 as part of a bullish spread with shares at $129.15. This was clearly a new position, as open interest in the strike was only 48 contracts before the trade occurred.

Those puts soared to $18.80 this afternoon, more than 6.5 times their purchase price. The stock fell 17 percent at the same time, a large move but nowhere near that of its 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.

ADSK dropped 15.86 percent to $109.34 today. The construction and engineering software company declined sharply in post-market trading yesterday after issuing disappointing guidance and announcing plans to cut 1,150 jobs as part of a restructuring plan.