Dividend Spreads Help Push Pfizer's Option Volume Over 2.5 Million Contracts

Pfizer PFE shares traded ex-dividend Tuesday, with the company set to pay out $0.22 per share. Option floor traders crossed large blocks of in-the money options with substantial open interest in hopes of collecting the dividend over night. By buying and selling the same amount of contracts in the same strikes, they will exercise the long position and hope not to get assigned in the short position. If succesful, they will come in Wednesday with a long stock/short call position whereby pocketing the company's quarterly payout.