Option Bear Bets on Deeper Losses for Ford Stock

One trader is betting on Ford to decline through the end of 2018

Jul 6, 2018 at 2:30 PM
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Options volume has been light overall this holiday week, but one stock drawing major attention from traders today is Ford Motor Company (NYSE:F). Nearly 36,000 puts have changed hands, with volume on pace to more than double the automaker's daily average of about 19,000 contracts. Conversely, today's F call volume of 16,719 contracts represents about half the expected intraday level.

The most active option strikes today are the August 12 put and the December 11 put, where upwards of 10,000 contracts apiece have crossed the tape. Shortly after 10 AM Eastern this morning, matching blocks of 9,872 contracts traded at these two strikes, with the August 12 puts crossing at the bid of $1.20 and the December 11 puts going off at the ask price of $0.78. Based on open interest levels at each strike -- and as confirmed by Trade-Alert -- it looks as though one trader is rolling the August-dated options out to the December series and down to the 11 strike.

Essentially, this trader is betting on deeper and more prolonged losses for Ford stock, which has shed 10.4% so far in 2018. In fact, after a close last Friday below its 10% year-to-date loss marker of $11.12, F has been held in check by this round percentage level all week long.

In today's session, Ford shares are flat at $11.05. Auto stocks are trading mixed overall this afternoon, as the sector catches its collective breath following Thursday's big gains on tariff optimism.

ford stock 30-minute 0706


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