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Adding a put position to these picks makes the stocks more palatable for conservative investors.
The trader appears to have established a short strangle in combination with a long put position.
SPDR KBE Bank : One big options player booked significant profits on a previously established long put position on the KBE Monday.
The investor will be able to bank gains on the new short put position if he can buy back the options for less than 52 cents by expiration.
Harley-Davidson : Bearish premonition on the motorcycle company proved profitable for one investor today who was observed closing out a put position on the stock.
The new long put position is closer to the money and therefore provides more effective downside protection should shares of the fund erode beneath the break-even point at $41.00 ahead of expiration day in June.
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Furthermore, options speculators have loaded up on put positions.
Overall, call trading has outpaced put positioning in today's action by around 2-to-1.
The ratio has increased from 0.68 to 0.72 as investors add more put positions.
In other words, there are 164 open short-term put positions for every 100 open short-term calls.
It's also important because this wealth of put positions has accumulated as we approach expiration this week.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com