Downside Puts Sold on Franco-Nevada (FNV)
Shares of Franco-Nevada (FNV) are currently lower on the session by 1.32% trading at $48.88. While shares seem to be having trouble breaking through the $51.00 resistance level, the stock’s chart pattern is strong, with higher lows rising above the 50-day and 200-day moving averages.
One options trader is drawing the line in the sand today, willing to purchase shares if FNV heads lower over the next few months. The January 2013 $45.00 put was sold 2,000 times, on the bid, for $1.65; open interest is only 93 contracts, indicating new positioning. The strike is currently bid $1.75, at $2.05.
The trader’s move is quite interesting in that he or she is willing to sell volatility at a four month (nearly 12-month) low. Overall implied and historical volatility is currently registering 23% and 27% respectively.
Franco-Nevada Corporation is a gold-focused royalty and stream company with additional interests in platinum group metals, oil and gas, and other resource assets.
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