Learn the trade here. Make it on tradeMONSTER

Options Trading News

February 7, 2013  Thu 3:47 AM CT

QQQ: SEE CHART GET CHAIN FIND STRATEGIES
The PowerShares QQQ Trust attracted an unusual call spread yesterday.

optionMONSTER's system shows that a trader sold 15,000 April 68 calls, led by a block of 10,000 that went for $1.24, and sold 30,000 April 71 calls that included a print of 20,000 for $0.31. The volume at each strike was well above the previous open interest, so this is a new backspread.

The position takes in a credit of $0.62, which will be the profit if the QQQ remains below $68. The trader can also profit if shares move sharply higher, as he or she owns twice as many of the higher-strike calls. (See our Education section)

The QQQ finished the day down fractionally at $67.24. The exchange-traded fund has been in a relatively tight range since the start of 2013, between $66.20 and $67.70. And while its 20-day historical volatility has picked up with the action of the last four sessions, it was at a 52-week low below 8 percent.  

Total option volume in the fund was more than 278,000 contracts, about 100,000 more than its daily average in the last month.
Share this article with your friends


TRADING WEEKLY OPTIONS

The fastest money in the market
View full report »

Premium Services

Free Webinar Series

Using Options for Income

Education & Strategy

Importance of learning the basics

Personally, I could never understand how so many option instructors start teaching strategies before explaining what an option is. I...

View more education articles »
optionMONSTER stockMONSTER tradeMONSTER