Option traders who opened upside positions in Medical Properties Trust Inc (MPW) last month are now seeing big rewards.
Those puts have traded for as much as $3.09 this session, a 1,187.50% return, while the stock fell 38.02% 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.
MPW was last down 8.2% at $6.88.
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