A large bearish spread took aim at Dish Network yesterday even as its shares rebounded.
optionMONSTER systems show that a trader bought 4,000 September 55 puts for $3.20 and sold 4,000 September 45 puts for $0.90. Volume was far above previous open interest in each strike, indicating new positioning.
This vertical spread cost $2.30 to open, which is the maximum amount at risk. The maximum potential gain is $7.70, which would be realized if the stock is right at $45 at expiration in mid-September. The trader would be on the hook to buy shares if they are below that strike price. (See our Education section)
DISH closed at $62.04 yesterday, up 0.42 percent on the session after falling to $60.59 in the morning. The satellite-television operator hit $62.60 last Friday--its highest price since May 2000--and last traded near the $45 level in early October.
Total option volume in the name was just shy of 16,000 yesterday, more than double its daily average for the last month. Overall puts outpaced calls by 2 to 1.
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