Why large call sale is targeting Prologis
Chris McKhann | email@example.com
PLD is down fractionally today at $32.16. The real-estate investment trust yesterday saw a sharp rebound off Friday's close, its lowest since the middle of January. Shares were above $36 at the start of this month and fell sharply from there.
More than 3,400 PLD options have traded so far today, compared to a daily average of 250 in the last month. Almost all of this volume is in one print of 3,342 June 34 calls, which were sold for the bid price of $0.20, according to optionMONSTER's systems. The volume was twice the previous open interest, so it was a new opening position.
The call sale is a bet that PLD won't be much above that strike over the coming weeks. The calls may have been sold naked, which would have an initial bearish bias and would profit with the stock anywhere below $34.20. The options could also have been sold against stock in a covered call position, which would be bullish up to $34 strike price but not beyond. (See our Education section)