Puts Sold on Cisco Systems (CSCO)
Puts Sold on Cisco Systems (CSCO)
Shares of Cisco Systems (CSCO) are trading lower on the session by 1.22%, at $19.48. The stock has been trending higher over the past six weeks, jumping off of the $15.00 level and rallying nearly 30%.
With such a large move so quickly, you wouldnít fault traders for buying protection on the name; that is not what we are seeing today, however. In fact, one institutional trader is betting that shares will remain above $19.28 through the end of next week.
A short while ago, the September 14th $19.50 weekly put was sold 6,384 times, on the bid, for $0.22. Volume on the strike has since risen to over 11,000 contracts. With open interest of 243 contracts, this is clearly new positioning.
Historical and implied volatilities recently diverged, with implied still holding a large premium over historical, at 21% and 37% respectively. The above block trade is voicing the opinion that movement within the name will settle down over the next few days, thereby betting on declining HV.
Cisco Systems, Inc. designs, manufactures, and sells Internet protocol (IP)-based networking and other products related to the communications and information technology industry and provide services associated with these products and their use.
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