Equity Residential seen on solid ground

By David Russell,

Shutterstock photo

Equity Residential has been steadily trending higher, and one investor apparently thinks that there is no looking back.

optionMONSTER's tracking systems detected the sale of 2,750 October 60 puts, most of which priced for $2.95. Volume was 21 times greater than open interest in the strike.

EQR is up 1.16 percent to $61.30 in late morning trading, gaining 18 percent so far this year. The owner of apartment buildings has been climbing along with most other real-estate investment trusts as the economy improves.

The put seller is betting that the shares will remain above $60 through expiration, which will let them keep the premium. Below that level, they'll have to buy stock at the strike price. (See our Education section)

EQR has been bucking resistance at the $60 level since early May but appears to have broken free last week. Some chart watchers may now expect support at that level, which helps explain the put sale.

Overall option volume in EQR is 7 times greater than average so far today.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.

This article appears in: Investing Options
Referenced Stocks: EQR

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