Digital Realty draws volatility play
Chris McKhann | firstname.lastname@example.org
optionMONSTER systems show that 3,524 September 65 calls were sold in a single print for $0.70 against open interest of just 36 contracts. That was essentially was all of the morning's volume, which is about 8 times DLR's full-session average for the last month.
Seconds later, a block of 110,000 shares of DLR was bought for $62.62. Combined with the short calls, this creates a delta-neutral strategy position is focused more on volatility than the direction of the stock in coming weeks. (See our Education section)
DLR is up 0.92 percent to $62.86 today, its highest level since exactly a year ago. Shares of the real-estate investment trust have been trending higher from support at $50 since late March.
Digital Realty is scheduled to announce quarterly results on July 29. The implied volatility is 19 percent, while the historical volatility is just 10 percent.