Bearish Bets On Twitter Follow Musk's Comments On Spam Accounts

Tesla Inc TSLA CEO Elon Musk on Monday hinted at the possibility of paying less than his bid of $44 billion for Twitter Inc TWTR. Musk said he estimates at least 20% of Twitter's accounts to be spam bots, sending Twitter’s stock lower by more than 8% on Monday.

On CNBC's "Options Action," Mike Khouw of Optimize Advisors said that Twitter traded 1.4 times its average daily put volume on Monday.

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There were buyers of 34,801 of the May 35 puts at 54 cents per contract on average, Khouw mentioned. A lot of these buyers were “big institutional traders who were rolling down the May 45 puts, which they had previously bought,” he added.

Traders see Twitter’s stock retesting its March lows by May expiration, Khouw said.