A Line in the Sand for Groupon? (GRPN)

Shares of Groupon (GRPN) are trading higher on the session by 0.45%, at $4.50. The stock has lost 84% of its value since the IPO back in November 2011.

With shares trading $0.50 above its 52-week low, one trader is selling puts on GRPN today. A short while ago the December $3.50 put was sold 20,000 times, on the bid, for $0.20. Open interest on the strike is only 158 contracts.

This trader is betting that shares will remain above $3.30 over the next few months. If GRPN does just that, he or she will take down the full credit on the transaction of $400,000.

30-day implied volatility is up 0.5% today to 95.53%, while 10-day historical vol is registering 41.81%. At $0.20, the Dec $3.50 put traded at 88% vol.  

Groupon, Inc. is a local e-commerce marketplace that connects merchants to consumers by offering goods and services at a discount. 

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.