Michael Kors Holdings Limited (KORS) Low Lures Option Bears

A new low is attracting Michael Kors Holdings Ltd (KORS) put buyers

by Alex Eppstein

Published on May 13, 2015 at 2:00 PM
Updated on Jun 24, 2020 at 10:16 AM

Michael Kors Holdings Ltd (NYSE:KORS) puts have been popular in recent weeks, per data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). Specifically, the retailer's 10-day put/call volume ratio registers at 1.56, or higher than 90% of comparable readings from the past year.

There's a reason for this bearish betting, as well -- KORS has been a long-term technical disappointment, shedding 18.7% year-to-date to trade at $61.05. Earlier today, in fact, the equity hit an annual low of $60.77, and continues to face pressure from its 10-week moving average.

In options land, traders are once again favoring puts over calls. By the numbers, 14,000 puts are on the tape -- twice the expected intraday amount -- easily outstripping the 7,350 calls traded.

Digging deeper, one option trader appears to be rolling out their May 65 puts to the August series. Meanwhile, others are buying to open the Michael Kors Holdings Ltd (NYSE:KORS) weekly 5/29 60-strike puts, expecting the stock to breach $60 -- and hit a new annual low -- by the close on Friday, May 29. Two days prior to that weekly expiration -- the morning of Wednesday, May 27 -- the company is scheduled to report earnings.

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