Big vote of confidence in Cisco
A large trader is betting that downside potential will be limited for Cisco.
optionMONSTER's tracking systems show that 7,500 August 25 puts were sold for $0.11 to $0.13 yesterday morning. Open interest in the strike was just 895 contracts before the trade occurred, indicating that it is a new position.
The put seller collects that premium and is looking for CSCO to stay above $25 through expiration in mid-August. If the stock falls below that strike price, the trader will be on the hook to buy shares at that level. (See our Education section)
CSCO slipped 0.64 percent to $29.43 yesterday. The network-technology giant has been trending higher since rebounding from the $27 level in early April.
Yesterday's activity in Cisco coincided with a similar trade in another large tech leader, Intel, which saw 5,500 August 28 puts sold. Total CSCO option volume was just shy of 64,000 yesterday, nearly double its daily average for the last month.
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