Puts target Archer Daniels Midland
Archer Daniels Midland has rebounded recently, but short-term traders are positioning for possible pullback this week.
optionMONSTER's Depth Charge monitoring system detected the purchase of 3,500 Weekly 34.50 puts expiring this Friday, Feb. 5 for $0.64 to $0.72 on Friday. Volume was more than 90 times open interest at the strike, which indicates new money was put to work.
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 Coaching section)
ADM rose 1.87 percent to $35.35 on Friday but is down 25 percent in the last three months. The last quarterly report on Nov. 3 was bearish. The next quarterly report is scheduled for pre-market hours on Feb. 2.
Overall option volume was 4 times greater than average. Puts outnumbered calls by a bearish 5-to-1 ratio.
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