Breakdown of Unusually timed trades in CNC before healthcare news, as well as SALE ENDS ON TUESDAY
A breakdown of unusual options trades and how to spot them.
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Hey all,
Nicholas from the Unusual Whales team, here! We’re going to spend one issue every week walking you through some trades of the week for free to help your trading!
In this issue, we’re going to cover yet another example of unusually timed options transactions. Once again, someone appears to have taken trades preceding major news; this time on Centene, $CNC, a health insurance company that mainly focuses on government programs such as Medicaid, Medicare, and the Health Insurance Marketplace. We’ll walk through why these trades stand out, and at the end, we’ll cover an honorable mention for a trade that went the opposite direction and got absolutely torched.
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The News
After market close on July 1st, 2025, news dropped by Centene outlined a withdrawal of full-year guidance. With mentions of ballooning Medicaid/ACA costs, and new marketplace data showing fewer signing up, and less healthier clientele amongst those who do sign up. The market reaction on July 2nd was anything but positive.
$CNC absolutely knifed, dropping nearly 30% in afterhours and pre-market trading alone.. Throughout the trading day on July 2nd, $CNC continued its decline, reaching roughly -40% from its previous close. So who made money on this?
First up, the July 18th $53 puts.
The initial $53P 7/18/2025 position hit the tape on June 25th, with 1000 contracts filled at an average price of $1.14 per contract. The very next day on June 26th, another 1000 contracts stacked on top of that, this time at $1.35 average. That rounded the total position (assuming this was the same trader) to 2000 total contracts at an average price of around $1.25, at a cost of around $249,000 in premium.
At the time, the underlying stock price traded at $53.96 per share on the first entry, and $53.38 for the entry on the 26th. At entry, these puts were basically at-the-money, but the reinforcement of consecutive days with identical volume and open interest carryover could indicate a more a clear directional bias rather than a defensive hedge. And they paid off.
On July 2nd, the day Centene dumped after pulling its guidance, these $53 puts ripped their way to a high of $17.70; a monstrous 1322% gain for only 5 days of holding (though not without drawdown; these were down 76% on July 1st when they hit $0.30 per contract; the position remained open despite that immense drawdown!!!!)
Entry: $1.25
High: $17.70
(17.70 - 1.245) ÷ 1.245 = +1322%
And they’re still open, so it remains to be seen if this trader has hit the value peak for their contracts, or if there’s room still to the downside.
Let’s look at the July 11th $56 puts.
This order came through on July 1st, literally the day before $CNC announced the guidance withdrawal.
There were 300 contracts filled at an average price of $0.56 per contract, with the stock trading at $57.38. These weren’t that far OTM, but they were definitely a directional bet, considering the stock was hanging on multi-month support levels. That’s about $16,800 in premium risk, which is small on an institutional scale, but the profitability is absolutely nothing to scoff at.
By July 2nd, these contracts ran as high as $22.13, for a staggering 3850% move:
Entry: $0.56
High: $22.13
(22.13 - 0.56) ÷ 0.56 = +3850%
That is the kind of risk/reward that makes you question how they hit the timing so perfectly… Just one day before guidance got pulled and the entire $CNC managed-care complex rolled end-over-end into meltdown mode. Hmm…..
And the flow certainly didn’t go unnoticed. Unusual Whales affiliate Jurassic Zombie spotted the flow on July 1st, and played it in their own way.
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The Short Puts That Missed
2,000 contracts of the August 16th $60 puts were sold on May 27th for $5.05 per contract. Whoever wrote these took in $1,010,000 in premium, perhaps expecting to collect theta and go on vacation.
Not quite. Not quite to the tune of - 400%.
As of July 2nd, those contracts were trading $25.20 bid, meaning the short put seller is down about 399% on mark-to-market:
Sold at: $5.05
Current: $25.20
(5.05 - 25.20) ÷ 5.05 = -399%
And that position is still open. If they hedged or adjusted, we can’t know, but it’s an ugly one to carry into a stock collapse like this.
The July $53 and $56 puts stand out because they were directional, sized, timed right before a known earnings window, and stacked on top of each other with clear conviction. Not multi-leg. No weird rolls. No spreads. Just clean bearish intent, and it hit perfectly.
The $60P short shows the other side of the coin: selling naked premium in front of an uncertain catalyst can and will blow up if the unexpected happens; or if the “unexpected” is actually less unexpected than you think.
REMEMBER!!!! Unusual Whales is having an Independence Day sale! Get 15% off any tier, or 20% off for upgrading your current tier! THE SALE ENDS on Tuesday, so get it here: unusualwhales.com/settings
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NOTE: This post is not financial advice. The stock market is risky, and any trade or investment is expected to have some, or total, loss. Please do research before any trade. Do not use this information for investment decisions. Check terms on site for full terms. Agree to terms before considering this information.