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December 11, 2012  Tue 3:16 AM CT

HYG: SEE CHART GET CHAIN FIND STRATEGIES
The iShares High-Yield Corporate Bond Fund is near multi-year highs, but a large trader apparently believes that further upside will be limited.

optionMONSTER systems show that a trader sold 5,000 March 93 calls for the $1.20 yesterday. Open interest in the strike was 1,126 contracts at the beginning of the session, so this is a new position.

The call selling is a bet that the HYG will continue to run into resistance around that $93 level. The options could have been sold naked with an initial bearish bias or traded against long shares as a covered call. (See our Education section)

The HYG rose fractionally yesterday to close at $93.29. The exchange-traded fund bounced off support near $90 three weeks ago. Resistance around $94 has been in place since June 2008, with a four-year high coming in right around that level in mid-September.
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Education & Strategy

The Strike-Based Greeks

The other Greeks (Gamma, Vega, and Theta) are calculated by using month and strike data, and not by individual option. These are called strike-based Greeks. Gamma, Theta, and Vega are all strike-based Greeks

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