Put sellers see floor in General Motors
Traders are looking for General Motors to hold its ground.
optionMONSTER's monitoring programs show that about 7,600 February 27.50 puts were sold for $0.31 to $0.54 today. Volume surpassed open interest of 2,353 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 Coaching section)
GM is up 0.73 percent to $29.14 in morning trading but is down 19 percent in the last three months. The auto maker fell yesterday despite beating earnings and revenue estimates.
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