Paper bought 6,000 KMX April 50 puts & sold 12,000 KMX April 45 puts against it for a net debit of .70.
?CarMax Inc., trading 50.48 with an IV30 of 48.21 and an HV10 of 42.42, is seeing bearish put action today. A trader executed a large 1 by 2 put spread in April.? In the name that trades 4200 contracts a day and has open interest of 87,000, a customer bought 6,000 of the April 50 puts paying 2.40 and against it sold 12,000 of the April 45 puts collecting .85 a spread for a net debit of .70.
This is likely a hedge trade with the customer looking to protect his or her KMX position between 50 and 45 but willing to bet that KMX is not going to make much of a move below 45 and the stock will stay above 40.70.
This trade should be considered bearish KMX and bearish volatility.