One investor is milking income from food distributor Sysco.
optionMONSTER's tracking programs detected the purchase of about
1,050 January 30 calls for $1.58 and the sale of an equal number of
August 31 calls for $1.53. Volume was below open interest in the
January contracts but not the August options, which indicates that
an existing short position was closed and rolled into next summer.
SYY rose 0.09 percent to $31.71 yesterday, so those calls are
in the money
. Selling them creates a position more akin to a bond trade than a
stock play because it reduces
and caps gains.
The investor probably owns SYY shares, letting him or her collect
its 3.5 percent annualized dividend.
Adjusting the short calls
cost about $0.05, but the trader now has the right to collect an an
additional $1 of upside on the stock while agreeing to stay in the
position for another seven months. (See our
section for more on how options can be used to
turn time into money
Later in the session, an additional 2,200 August 31 calls were sold
for $1.60. It's not clear whether the transactions were related.
More than 8,900 contracts traded in the name yesterday, almost 13
times the normal daily average.
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