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This post was written by Minyanville contributor Steve Smith Hasbro, Inc. (NYSE: HAS) has seen unusual option activity. The notable trades are occurring in the October series with buying of the $27.50 and $25 puts.
Yesterday those strikes traded over 2,600 contracts each with nearly all of it translating into new open interest. This morning these have traded over 1,000 contracts each with most of the volume coming at the asking price suggesting this is buying and someone is accumulating these put spreads.
But tempering this seemingly bearish positioning is that today someone is buying the October $27.50 calls and selling the January $25 puts.
The sale of the Jan. puts seems to be in part financing the purchase of the October calls and put spreads. So net, net, this is actually a moderately bullish position that would have the greatest profit potential on a large share gain.
The fact that someone is using the October and January options suggests it a longer term position rather than purely speculative or in anticipation of news or an event.
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