Relypsa receives a vote of confidence
At least one trader apparently believes that Relypsa is due for a rebound.
optionMONSTER's monitoring systems detected the sale of 2,300 February 17.50 puts for $1.60 and $1.62 at the same second yesterday. This is clearly a new position, as open interest in the strike was a mere 15 contracts before the trade occurred.
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 Coaching section.)
RLYP fell 7.86 percent to $19.59 yesterday and is down 25 percent just in the last week. The biopharmaceutical company is estimated to come out with quarterly results after the close on March 10.
Overall option volume was about average in RLYP yesterday.
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