One investor is betting that CenturyLink will stay stuck in a range even as the telecom stock probes its recent highs.
optionMONSTER’s tracking systems detected the sale of 25,000 October 42 calls for $0.35 against open interest of just 2,218 contracts. It was one of the largest single blocks of options to price in the market so far today.
The investor is now obligated to sell shares for $42 if they close above that level on expiration. He or she probably owns the stock and wrote the calls to earn income against their position. The strategy increases the cash they’re already collecting thanks to the stock’s 7 percent dividend yield. (See our Education section)
— Option Monster