Options speculators are apparently expecting bad things from Washington Mutual (WM). It will report earnings on 4/17. Today more than 10,000 April 35 puts have traded vs open interest of just over 7,400. More than 14 thousand April 37-1/2 puts have traded vs open interest of 19.7k. KBW recently stated, "WM which has a large share of production in Alt A products and, in our view, has a large share of its balance sheet exposed to mortgage."
Is this a candidate for a pre-announcement, or are these speculators going to ride to the cliff by holding through to earnings next Tuesday, just 3 days before expiration?