Put buyers land big gains in $MQ

Option bears are being rewarded today with big profits on downside positions in Marqeta Inc (MQ).

On Dec. 30, Market Rebellion’s Unusual Activity programs detected the the purchase of 10,000 February $17.50 puts as part of a bearish spread for $1.95 with shares at $17.72. Volume was clearly above the previous open interest of 32 contracts, indicating that this was a new position.

Those puts traded for as much as $4.70 this session, over double their purchase price. The stock fell 26.41% 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.

MQ settled the session at $13.71, down 5.32% on the day.