Options Trade Bets Against Medical Device Maker
This blog post was written by OptionMonster's Chris McKhann.
Boston Scientific is fighting to break out of its recent trading range as a large block of puts changes hands.
BSX opened today by more than 2 percent from its close of $7.60 yesterday, but the shares have been bouncing between $7 and $8 since early December. BSX had been steadily above $12 until falling by more than 50 percent in October.
The put activity coincides with a company setback in its protracted court battle with Johnson & Johnson over heart stent patents. The contracts in play are the February 7.5 puts, where one block of 16,487 traded for $0.80. Seconds later, the exact same number of January 7.5 puts traded for $0.05, according to OptionMonster's tracking systems.
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The former were more than open interest, and the latter were less. That, combined with their prices, indicate that this was a trader taking the puts in January off the table before expiration today and rolling out to February.
This could be a protective position or an outright downside play, looking for shares to return to recent lows below $6.
More Medical Device Makers:
St. Jude Medical
Jon 'DRJ' Najarian is a professional investor, CNBC contributor, and cofounder of OptionMonster.com.