Big put spread targets iStar Financial
Chris McKhann | firstname.lastname@example.org
SFI is down another 2.3 percent to trade at $6.33. The commercial-property lender has fallen for six out of the last seven sessions and has been trending lower since trading above $7.90 in late March. Shares are now at their lowest levels since mid-January.
More than 50,000 SFI options have already traded today, compared to a daily average of 1,050. A trader sold 25,000 January 2013 5 puts against larger open interest and bought the same number of January 2014 5 puts. Blocks of 15,000 contracts were sold in the 2013 puts for the bid price of $0.60 and bought in the 2014 puts for $1.25, according to optionMONSTER's systems. Then 35 minutes later, blocks of 10,000 went for $0.65 and $1.30 respectively.
The trade could be a calendar spread, which would look for SFI to trade around $5 at expiration. Or this could be a roll, with the trader selling the long 2013 puts and moving the position out a year while doubling the cost. (See our Education section)