SouFun Draws More Put Selling

Long-term put selling is a popular trade today, as we see in Chinese real-estate Internet company SouFun.

optionMONSTER systems show that 5,000 January 2016 11 puts were sold for $2.70 on a wide bid/ask spread. This is new positioning, as the strike’s previous open interest was only 16 contracts.

The seller is looking for SFUN to stay above $11 through early 2016. The trader also would be on the hook to buy shares if they fall below that level, for an effective purchase price of $8.30 including the credit from the put sale.

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