Paper bought just over 9600 NAV Jan 2018 5 puts tied to stock.?
Navistar International Corp., trading 10.76 with an IV30 of 91.33 and an HV10 of 64%, saw large block of 2018 5 puts trade today.? The stock, with an ADV of 1300 and an OI of 89,000, saw a customer buy a just over 9600 of the Jan 2018 5 puts paying between 1.675 tied to stock.? Based on the OI this is likely opening but COULD be a close.
This appears to be a customer that is hedging the long term prospects of NAV.? The customer is paying a healthy premium to be hedged on a stock position below 5.00 a share in this name.? The customer may also be using the puts to add to an existing stock position as they provide a hedge.
This trade should be considered bearish the stock and bullish long term NAV vol.