Puts score in $JWN

Puts are scoring for bearish option traders in Nordstrom (JWN) today.

Just yesterday on Oct. 26, Market Rebellion’s Unusual Option Activity Service flagged the purchase of 2,000 Weekly $14.50 puts, expiring on Oct. 30, for $0.75 to $0.90 with shares at $13.93. Volume was above the strike’s existing open interest of 180 contracts, indicating that this was fresh buying.

Those puts traded for as much as $1.91 today, double their purchase prices. The stock fell 9.4% in the same time frame, showing how options can far outperform moves in their underlying shares 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.

JWN was last down 5.25% to $12.55 in afternoon trading. The upscale retailer is estimated to next report earnings on Nov. 19 after the close of markets.