Comcast Corporation (NASDAQ: CMCSA) shares are up 22.6% in the past year despite a difficult environment for traditional cable TV. However, at least one large option trader is betting 2020 will be a difficult year for Comcast.
On Wednesday, Benzinga Pro subscribers received an option alert related to an unusually large trade in Comcast options.
At 12:18 p.m., a trader bought 1,500 Comcast put options with a $42.50 strike price expiring in January 2021 near the ask price at $2.811. The trade represented a $421,650 bearish bet.
Why It's Important
Even traders who stick exclusively to stocks often monitor option market activity closely for unusually large trades. Given the relative complexity of the options market, large options traders are typically considered to be more sophisticated than the average stock trader.
Many of these large options traders are wealthy individuals or institutions who may have unique information or theses related to the underlying stock.
Unfortunately, stock traders often use the options market to hedge against their larger stock positions, and there’s no surefire way to determine if an options trade is a standalone position or a hedge. In this case, given the relatively small size of …
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