$COIN put buers score big overnight

Coinbase (COIN) is trading lower today, rewarding downside put positions opened only yesterday.

On Dec. 6Market Rebellion’s Unusual Option Activity Service found that 3,000 Weekly $41 puts, expiring this Friday, were bought for $0.30 with shares at $48.24. Volume was well above the strike’s previous open interest of 247 contracts, showing that this was fresh interest.

Those puts traded up to $1.61 this session, over 5 times their purchase price. The stock declined 15.22% in the same time period, a large move but nowhere near that of its options on a relative basis.

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.

COIN was down by 2.71% at $41.26 at the end of today’s trade.

Ready to start trading? Try Unusual Option Activity Essential. Learn how you can follow the “smart money” with a fresh UOA trade idea each week – including technical levels so that you know how to manage each trade!


Score 10% off annual services