Sprint Secondary Creates Opening for Options Play

Sprint's (FON Quote) whopping upcoming secondary offering of stock holds an interesting trading situation for options players, according to a report that came out earlier this week from the derivatives team at Salomon Smith Barney.

Salomon, a unit of Citigroup (C Quote), expects the offering, which is anticipated to be held this month, to "have a ceiling effect on Sprint for the next few weeks," keeping the stock in a trading range from which investors can benefit.

The Salomon derivatives squad thinks worried investors are going to sell into any strength in the stock and that Sprint bulls will hold off buying until after the secondary offering, two factors that are likely to limit Sprint's upside. That cap, if you will, can mean profits for investors using options . ...