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$OZK option bears score big profits

$OZK option bears score big profits

Bearish option traders are hitting big profits in downside positions on Bank Ozk (OZK).

On Mar. 7Market Rebellion’s Unusual Option Activity Service found that 10,300 May $40 puts were bought for $1.25 to $1.35 with shares at $43.03. This was clearly fresh buying, as the open interest in the contract before the activity appeared was just 290.

Those puts have traded up to $3.80 so far this session, over 2.5 times their purchase prices. The stock declined 11.95% 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.

OZK was last down 6.59% at $38.30.

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!

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