NQ Mobile has short sale restrictions in effect and it appears causing defensive investors to turn to the options market in an effort to protect against further downside pressure. With only 310,000 outstanding options held across all strikes and expirations among option traders, investors targeted protection using May 16 expiration put plays to defend against further weakness for the shares.

Exactly six months ago shares in NQ Mobile traded to as low as $7.58 and it appears wary investors are braced for a re-run. The out-of-the-money May put contract at the 8.0 strike has for some time been the most favored destination for traders and hosts the single most volume of open interest with 18,700 contracts ahead of today’s session.

With dealers apparently paying between 50-70-cents per contract Tuesday amid downside pressure for the stock the put-call ratio rose to 3.0 to display heavy relative demand for defensive plays. Put buyers bought a further 11,900 contracts ahead of noon at the 8.0 strike. Option implied volatility on the stock leapt by 16.4% to 159.0%.