Big trade sees ceiling in utilities fund
A large trade is betting that upside potential will be limited for the SPDR Utilities Fund.
optionMONSTER's monitoring systems detected the sale of 20,000 March 49 calls in one print for $0.26 yesterday. Volume was more than 5 times open interest at the strike, showing that this is a new position.
Short calls generate income and fix the price where a stock must be sold. The strategy is usually done in conjunction with long shares, reflecting a belief that upside will be limited through expiration. (See our Coaching section)
XLU rose 0.41 percent to $46.60 yesterday and is up 8 percent in the last month. Overall option volume was twice the daily average for the exchange-traded fund.
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