Moody’s (MCO) lost 73 cents to $27.59 Friday and put volume totaled 5,900 contracts, which was about 10X the number of calls. The top trade was 4350 Jan11 17.5 puts at the asking price of $1 per contract. It was an opening trade, as open interest increased by 4,544 to 22,689 and now the largest of any MCO options contract. There has been several days of put activity in recent days and the interest in Jan11 17.5 puts is possibly some investors hedging their bets in Moody’s for the remainder of 2010. With shares near $28, the contract is 37.5 percent out-of-the-money. It would take a substantial price decline for these puts to pay-off. Definitely a stock worth watching!
About the Author (Author Profile)
Frederic Ruffy is a well-known trader, writer, and strategist who has spent years educating investors and creating intelligent, insightful, unbiased market observations that are frequently cited by the Wall Street Journal and other financial publications. As senior analyst, Fred provides frequent and regular notes and daily updates for activity of interest.