As Equinix hits an 11-year high this morning, a complex strategy is positioning for more upside.
This morning EQIX, which provides data-center services, announced that it plans to convert into a real-estate investment trust. The stock is now up 7.21 percent to $200 after hitting $212 earlier in the session, its highest price since 2001. Shares have more than doubled since the start of this year.
A trader bought 2,360 March 210 calls for $18.50 and sold 4,638 March 250 calls for $4.32, according to optionMONSTER's tracking systems. The bid/ask spreads were very wide in both strikes with previous open interest at fewer than 50 contracts, so this is a new ratio spread.
The call spread cost the trader just under $10, which will be lost if EQIX remains below $210 through expiration. The maximum profit would come if the stock is around $250 at that time.
Our Depth Charge system detected bearish put buying on Tuesday, but the value of those contracts has been slipping since then.
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