Citigroup draws three-way put spread
Chris McKhann | firstname.lastname@example.org
C is down 3.7 percent to $25.53, which would be its lowest close since mid-December. The bank has been trending lower for the last two months from above $38.
More than 34,000 Citigroup options have changed hands already this morning. A trader sold 5,000 June 25 puts for $0.70 against open interest of 32,633 while buying 5,000 July 25 puts for $1.61 and selling the same number of July 20 puts for $0.43. Volume at both July strikes was more than the open interest, so this is a new put spread.
This appears to be a trader rolling a put position from the June expiration, which has just two weeks until expiration. Those last two weeks of an option contract's life are the worst in terms of time decay. The July 20 puts may have been sold to help offset the cost of buying the July 25 puts. (See our Education section)