Shares of Pioneer National Resources (PXD) are trading lower on the session by 0.83%, at $107.82. The stock has rallied throughout the past three months, culminating in a spike higher on September 14th to $115.69.
With shares touching historical resistance, one large institutional trader is rolling his or her call position in PXD today.
A short while ago, the December $110 call was sold 24,750 times, on the bid, for $7.50 and the December $130 call was purchased 24,750 times, on the offer, for $1.70. Given the respective open interest on both strikes, it is clear that this was a roll from the $110 strike to the $130 strike.
This trade likely coincides with the large long call spread that was initiated back on June 1st, where a trader bought 25,000 Dec $110/140 call spreads for a net debit of $5.00.
Therefore, the trader is taking $0.80 off the table here (a gain of $19,800) and receiving a ?free? $130/140 call spread in the process. Not a bad trade at all considering there is still a potential upside gain of $247,500, with no downside risk.
Pioneer Natural Resources Company is an independent oil and gas exploration and production company with operations in the United States and South Africa.?