Kroger is down sharply on disappointing revenues today, but traders apparently believe that further declines will be limited.
optionMONSTER's monitoring systems detected the sale of more than 12,000 April 35 puts for mostly for $0.55 to $0.60 today. Volume surpassed open interest of 10,211 contracts, an indication that new money was put to work.
Short puts lock in a price where investors must buy a stock, while letting them collect premium. Traders use the technique when they like a stock and think that the risk of a big drop is limited. (See our Education section.)
KR is down 7.22 percent to $37.72 in morning trading but is up 8 percent in the last three months. The grocery chain's earnings beat estimates, but revenues fell short of expectations.
Overall option volume is 3 times greater than average so far today.
More From optionMONSTER