$VIAC bears binge profits

ViacomCBS (VIAC) shares stremaed lower today, and bearish option traders are binging on profits.

Only yesterday afternoon, Market Rebellion’s Unusual Activity Service identified the purchase of 5,000 Weekly $95 puts, expiring this Friday, Mar. 26, for $2.56 to $2.65 as part of a bearish spread with shares at $95.07. This was clearly fresh buying, as open interest in the strike was only 3,926 contracts before 70.10activity appeared.

Those puts traded for as much as $24.64 this session, 10 times their purchase price. The stock fell 26.03% 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.

VIAC was down 23.18% to close at $70.10. The media conglomerate announced a 20 million share secondary, priced at $85.00, this morning to fund streaming content.