$WU put prices double

Bearish option traders turned big gains on Western Union (WU) today in downside positions.

On Jun. 10, Market Rebellion’s Unusual Activity tracking systems detected the purchase of 2,450 July $22 puts for $0.62 with shares at $23.81. This was clearly a new position, as the call volume was far above the strike’s open interest of 49 contracts.

Those puts traded up to $1.40 today, more than double their original purchase price. The stock fell 11.76% in the same time period, illustrating the kind of leverage that can be achieved through 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.

WU fell 3.32% to $20.95 today. The financial services company traded lower along with the broader market this session.