Is Focus Media Set To Crack? (FMCN)

Shares of Focus Media (FMCN) are trading lower on the session by 0.96%, at $23.76. The stock has been consolidating over the past three months following a sharp move higher throughout August.

With shares testing the 50-day and 200-day moving averages, one trader is buying a massive put spread. A short while ago, the January 2013 $21/16 put spread was purchased 10,000 times for $1.10. Given the current open interest on both strikes, 6,039 and 5,966 respectively, this is clearly new positioning.

Today’s trade has pushed overall put volume to 4.7x normal volume with 24,516 contracts traded.

30-day implied volatility is rising slightly today to 48.82%. There remains a large divergence to 10-day historical vol, which is registering only 14.49%.

Focus Media Holding Limited is a multi-platform digital media company, operating liquid crystal display display network in the People's Republic of China using audiovisual digital displays in commercial and residential locations. 

About Michael Zerinskas

Originally from Chicago, Michael J. Zerinskas began his career as an intern for a small high-frequency trading firm based at the CME; he then moved on to become Chief Options Strategist at Benzinga.com. Michael is now Unusual Activity Editor at The Options Insider, specializing in VIX, volatility, and flagging unusual activity.