InterPublic trade bets against pullback
InterPublic has begun a long-awaited rally, and investors
apparently think that there's no turning back for the advertising
optionMONSTER's tracking programs detected the sale of 3,200 August 19 puts for $0.70. Volume was more than 300 times open interest at the strike, which indicates that a new position was initiated.
The put seller is now on the hook to buy shares in the advertising company for $19 through mid-August, no matter how low they may trade at the time. Including the premium received today, the effective entry price would be $18.30. If the stock remains above the strike, the puts will expire worthless while the trader books the credit as profit. (See our Education section)
IPG is down 0.21 percent to $19.31 in afternoon trading but is up 14 percent in the last three months. The stock was the target of repeated upside option activity starting in March as it pushed against long-term resistance from 2004. Shares then broke out on a strong earnings report and have been running since.
Overall option volume is slightly above average in the stock today, with the put sale accounting for more than half the total.