Pulte Homes plunged to a new multi-year low today, after our OptionMonster tracking systems showed strong institutional put buying yesterday.
As a result, we didn't even have the trade on for 24 hours before PHM took that 12 percent dive, making our puts — which, of course, are the right to sell — much more valuable. The shares fell from over $8 yesterday to $6.53 today, yielding a handsome profit on the December 7.50 puts that we had flagged for their unusual activity in the previous session.
- More Options Action from Jon Najarian
- Pulte Homes: Insider Trends
- PHM Options Chain: Calls/Puts
Tells like that are wonderful, as they show us where the fast and smart money is hunting. I'll use some of that profit for a bankroll as I head to Las Vegas Friday, to give a presentation for the "Money Show" at the Mandalay Bay.
(By the way, if you'd like a free week of OptionMonster service, I'll offer you the same deal that I'm offering the crowd in Vegas: Just send an email to firstname.lastname@example.org with "Las Vegas" in the subject line, and we'll email you a password. No gamble there!)
Pulte Homes' Rivals:
Jon 'DRJ' Najarian is a professional investor, CNBC contributor, and cofounder of OptionMonster.