A customer sold 10,000 SD May 5 puts collecting .37 on the trade.? With the stock trading 5.34, the trader likely was looking for yield on a put spread.? With about a 6 month duration, the May 5 put pays about 15% per year in premium.? If the stock drops the customer appears willing to buy the company for 4.63 a share (a 15% discount to today?s price).
This trader should be considered moderately bullish the underlying and bearish movement in the name.? It is likely SD is not going to be ?off to the races? in either direction anytime soon.
Traders looking to piggy back this trade could consider buying the May 5/6/7 call fly for .23.? The trade has positive theta and leans bullish.