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optionMONSTER's tracking systems detected the purchase of 3,000 March 35 calls for $4 against open interest. An equal number of April 35s were sold for $4.20 against no previous positioning.
This suggests that an existing short position in the March contracts was rolled to the higher strike, resulting in a credit of $0.20 and keeping the investor in the trade for an additional month. He or she probably owns shares in the commercial-services company and is using the options to generate income.
CTAS is up 0.93 percent to $38.96 today and 35 percent in the last three months. The company, which mostly supplies uniforms to businesses such as restaurants and hotels, has beaten estimates for at least the last three quarters as hiring improves in the U.S. economy.
Today's option activity is noteworthy because the contracts are in the money , letting the investor earn a small amount of income while still owning the stock and collecting a dividend. Combined, these factors translate into a yield of 6-8 percent on an annualized basis. (See our Education section)
Overall option volume in CTAS is 6 times greater than average so far today.
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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.
