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Post by jonny80s on Oct 3, 2017 10:59:37 GMT -5
Why someone would purchase ~3k $3 puts @ $0.47 puts expiring this Friday?
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Post by peppy on Oct 3, 2017 11:03:01 GMT -5
Why someone would purchase ~3k $3 puts @ $0.47 puts expiring this Friday? less money spent trying to drive down the price of the stock?
they believe the media lies about demand and affectiveness?
brain injury?
they believe the trend is their friend and have not seen the change of trend, on the daily, weekly and monthly charts?
The e-trade baby pressed the wrong button?
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Post by parrerob on Oct 3, 2017 11:16:03 GMT -5
Why someone would purchase ~3k $3 puts @ $0.47 puts expiring this Friday? less money spent trying to drive down the price of the stock?
they believe the media lies about demand and affectiveness?
brain injury?
they believe the trend is their friend and have not seen the change of trend, on the daily, weekly and monthly charts?
The e-trade baby pressed the wrong button?
I think it is an "assurance" for a long short term position... |
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Post by mnkdfann on Oct 3, 2017 11:20:40 GMT -5
Why someone would purchase ~3k $3 puts @ $0.47 puts expiring this Friday? If someone is selling / writing puts, someone else (like the NASDAQ options Market Maker) has to buy. At some price. Did the trade start as an investor wanting to buy the puts? Or as someone wanting to sell / write the puts? Maybe someone short is writing those puts just to earn the premium? I dunno. |
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Post by matt on Oct 3, 2017 11:23:06 GMT -5
Why someone would purchase ~3k $3 puts @ $0.47 puts expiring this Friday? I might very well be a hedge of a portfolio of securities. Buyers of puts do not necessarily think the stock is going down any more than buyers of calls think the stock is going up. Unless you know the entire portfolio of securities held by this individual you just have to guess. Here is one hypothetical. A trader bought 3K shares near the open at $2.32 and added the puts later for $0.47. Total investment 2.32 + 0.47 = $2.79. Now this person holds a guaranteed value of $3.00 on his position, but if the stock keeps going up then he might do even better. However, if the stock price declines the $3.00 put insulates any downside. So this investor now owns the better of $3.00 (which is a profit of 21 cents per share vs the cost of $2.79) and wherever the price winds up on Friday, but the investor is not exposed to any downside risk. It is never the profit on a single security that matters, it is always the total return on a portfolio of related securities. |
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Post by lsl428 on Oct 3, 2017 11:42:18 GMT -5
Why someone would purchase ~3k $3 puts @ $0.47 puts expiring this Friday? It is possible that this put purchase was attached to a stock purchase of 300K shares so limiting downside while upside remains thru this friday expo |
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