Freeport-McMoRan has nearly tripled in recent months, but traders are positioning for a possible drop.
optionMONSTER's monitoring system shows that more than 25,000 June 13 puts were purchased for $1.40 to $1.60 yesterday. This represents fresh buying, as open interest in the strike was only 480 contracts before the session began.
Long puts lock in the price where a stock can be sold, so they make money to the downside. Investors use them to hedge long positions or to speculate on a drop. (See our Education section)
FCX slipped 0.08 percent to $12.64 yesterday but is up 172 percent in the last three months. The mining and energy company is expected to announce quarterly results on July 21.
Overall option volume in the name was twice its daily average yesterday. Puts outnumbered calls by a narrow margin.
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