Unusual spread in Select Medical

optionMONSTER

Select Medical Holdings is seeing an interesting calendar spread as shares remain trapped in a tight range.

More than 7,300 SEM options have change hands so far today, compared to the total open interest of 1,226 contracts and the daily average volume of just 16. optionMONSTER systems show that a trader bought 2,931 June 7.50 puts for $0.62 and sold the same number of March 7.50 puts for $0.17.

This calendar spread cost the trader $0.45, which is the maximum amount at risk until the first expiration in mid-March. The maximum gain would be realized with SEM right around $7.50 at that time. (See our Education section)

SEM is down 0.93 percent to $8.49. The hospital operator has been trading between $8 and $9 since early June, with some limited exceptions going back to February. It did make a quick break down to the 52-week intraday low of $7.21 on May 3. 

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