Puts have emerged as the options of choice on Smith & Wesson Holding Corporation (NASDAQ:SWHC - 7.70) today, with volume spiking to roughly 19 times the expected intraday level. So far, more than 8,870 puts have crossed the tape on SWHC, easily outstripping the gun stock's average daily volume of 1,212 contracts.

With December-dated options due to expire at the end of this week, today's put players are focusing on the January 2013 series. Specifically, the most active strike is SWHC's January 8 put, where 3,378 contracts have been traded. More than half of these puts traded closer to the ask price, suggesting they were purchased, and implied volatility on the option has jumped 2 percentage points -- confirming demand is on the rise for this back-month strike. With only 2,764 contracts in open interest at the January 8 put, it's safe to assume that new bearish bets are being added here today.

These puts traded at a volume-weighted average price (VWAP) of $0.63, which means most of today's traders need SWHC to fall below breakeven at $7.37 by the time January-dated options expire (just under five weeks away). Based on the stock's current price of $7.70, that's a drop of about 4.3%.

The shares are down 11% in intraday action, with reports indicating President Obama has instructed his Cabinet to begin work on a potential ban for assault rifles. Due to SWHC's steep slide over the past couple of days, short selling has been temporarily halted -- which may explain why the stock's bears are suddenly flocking toward put options.