Options: Bears in Capital One's Pocket

By Jud Pyle, CFA, chief investment strategist for the Options News Network

Investors in Capital One Financial (COF Quote) are still beared-up days after Standard & Poor's Rating Services downgraded the bank to BBB- from BBB+ on concerns that greater volatility and tighter regulation could result in a worse future for banks.

An investor bought the Sept. 15-Sept. 20 put spread 20,000 times during the first hour of trading Friday for $1.58 per spread with the stock at $21.91. The Sept. 15 puts closed down 7 cents while the Sept. 20 puts closed down 10 cents on Friday. The Sept. 15 puts were home to open interest of 3,757 and the Sept. 20 puts were home to open interest of 6,830.

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