Investor rings the register in Sinclair

By David Russell,

Shutterstock photo

Someone's ringing the register in Sinclair Broadcasting Group.

optionMONSTER's trade scanners detected the sale of 3,000 January 30 calls for $3.60. Volume was more than 100 times previous open interest at the strike, indicating that a new position was implemented.

The investor is now on the hook to unload shares in the television company for $30 if they're above that level on expiration. Including the credit received, the net exit price would be $33.60. (See our Education section)

SBGI is up 2.22 percent to $33.65 in morning trading, so those contracts were in the money . The investor almost certainly owns shares and is using the options to delay the sale until 2014--possibly to delay a large capital gain to the next tax year.

This way, SBGI can decline almost 10 percent without them losing any money. The stock has roughly tripled in the last 12 months, so the investor probably has big gains to protect.

Total option volume is 6 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: SBGI

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