Markets

Strategy plans exit from Constellation

Constellation Brands has been strong, but one investor wants out.

optionMONSTER's Depth Charge monitoring program detected the sale of 3,988 October 30 calls for $2.90 and the purchase of an equal number of October 27.50 puts for $0.30. Volume was more than twice open interest at both strikes and the trade resulted in a net credit of $2.60.

The trader probably owns shares in the company, which sells beer, wine, and liquor. He or she is now obligated to sell the stock for $30 but, including the premium, received their exit price would be $32.60. That cash and puts also protect them to the downside, ensuring minimum proceeds of $30.10. (See more on collar trades )

STZ is up 0.93 percent to $32.49 this morning and 65 percent in the last three months. Most of that move came after the company took over the lucrative Corona beer business in the U.S. and earnings beat expectations in late June. (See researchLAB for more)

Overall option volume in the name is 5 times greater than average so far today, according to the Depth Charge.

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

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

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