DB has shed roughly half its value in 2018
The shares of Deutsche Bank AG (NYSE:DB) are down 3.3% to trade at $9.56 this morning after it was reported German authorities raided the company's offices early this morning, in connection to a money laundering investigation. Two staff members were allegedly setting up offshore firms as part of what's been dubbed the "Panama Papers."
On the charts, Deutsche Bank stock has endured a drubbing in 2018. DB has shed 48% overall this year, carving out a channel of lower lows since late July, culminating in a record low of $9.20 on Nov. 20. Since late September, the shares' 30-day moving average has kept a tight lid on any breakouts.
Short sellers have been targeting the stock in the meantime. Short interest jumped 16.2% in the last two reporting periods, and now accounts for a healthy 4% of the float. Going by average daily volumes, it'd take these bears almost 14 sessions to cover.
In the options pits, puts have been in favor. DB's 10-day put/call volume ratio of 2.17 on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks 3 percentage points from an annual high, indicating that speculators have shown a much healthier-than-usual appetite for bearish bets during the past two weeks.
Echoing this, the equity's Schaeffer's put/call open interest ratio (SOIR) stands at 1.12, which arrives in the 87th percentile of its annual range. In other words, speculators are more put-skewed than normal among options set to expire within three months.