Put Spread Player Bets on Bank of America Pullback

Puts were unusually popular on Bank of America

Monday, with volume rising to 1.50 times the expected level. Roughly 144,000 puts changed hands on the Dow component during the course of the session, easily outpacing the banking baron's predicted daily volume of 96,000 contracts. Taking a closer look at the day's major block trades, it looks as though one speculator is expecting a modest pullback from BAC during the near term. In afternoon action, a block of 20,000 November 13 puts traded at the ask price, suggesting they were purchased. Simultaneously, a block of 40,000 November 11 puts crossed the tape at the bid price, indicating they were most likely sold. Open interest rose substantially at both strikes overnight, confirming that these were all freshly opened positions.

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