Heavy Put Buying in Fannie Mae

Shares of Fannie Mae FNM are flat on the session, currently trading $1.03, but one trader is betting that the stock will not stay there for long. They are buying the September $1 put heavily today; a single block of 13,921 contracts was purchased on the offer for $0.23 a short while ago. Open interest on that strike is 17,863 contracts. Put volume is running at 2.42x the daily average with 90% of all puts traded being purchases on the offer. Fannie Mae announced that they were redeeming several bonds with May maturities and that the redemption price will be paid 100% plus accrued interest. Apparently they are refinancing their debt and kicking it down the road.