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Options Trader Betting On Carvana Falling Even Further, After Stock Loses 97% Year-To-Date

Published 08/11/2022, 13:21
Updated 08/11/2022, 14:41
© Reuters.  Options Trader Betting On Carvana Falling Even Further, After Stock Loses 97% Year-To-Date
CVNA
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On CNBC's "Options Action," Michael Khouw of Optimize Advisors said that Carvana Co. (NYSE: CVNA) traded more than 4 times its average daily put volume on Monday. The stock has lost 97% year to date.

Check out other stocks making moves in the premarket.

There was a buyer who rolled 6,830 January 2024 12.5 puts down to January 2024 5 puts at an average price of $2.25 per contract, Khouw stated. The trader may be using this to hedge against a debt, he stated. When a company liquidates, the equity goes to zero, “sometimes there is a recovery rate on the bonds, and it is an arbitrage trade. I think that is what is going on here,” he added.

CVNA Price Action: Shares of Carvana declined by 15.64% to settle at $7.39, on Monday.

Now Read: Is It Time To Buy Amazon (NASDAQ:AMZN), Google (NASDAQ:GOOGL) Amid Recent Dip? What Cramer Has To Say

Photo: Tony Webster from flickr

© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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