OptionsHouse

Options Trading News

December 20, 2012  Thu 9:15 AM CT

EEM: SEE CHART GET CHAIN FIND STRATEGIES
A large call sale tops today's option activity in the iShares Emerging Markets Fund.

optionMONSTER systems show that a single print of 80,500 EEM March 47 calls is by far the largest trade of the day so far, but it isn't overly bullish. The calls were sold for the bid price of $0.36 in volume far above the previous open interest of 3,257 contracts, so this is a new position.

These calls could have been sold naked with an initial bearish bias, though that position could profit with the EEM anywhere below $47.36 at expiration. The options could also have been traded against long stock in a covered call strategy, but they would need 8.05 million EEM shares to change hands for that position. (See our Education(See our Education section) section)

The EEM is up 0.14 percent to $43.57 this morning. The exchange-traded fund has been trending higher since hitting a 52-week low under $37 in late May and is now back to levels from early April.
Share this article with your friends


OptionsHouse

Premium Services

Upcoming Webinar:

Using Options For Income

http://bit.ly/1nY1OKA

Jon Najarian and Adam Mesh of Options Wealth Machine discuss a detailed strategy utilizing credit spreads to generate income, and how any level of trader can use this simple trading technique.

Education & Strategy

Sweet Spot Exceptions

As discussed last week, when using the Stock Replacement Strategy to replace a stock position to trade direction, we want to use an option that has very similar characteristics to the stock. We talked about using the deep in-the-money, 80 to 85 delta option that is similar in the Greeks and has relatively little extrinsic value which tends to work against us in stock directional trading.

View more education articles »