OptionsHouse

Options Trading News

November 15, 2012  Thu 1:47 AM CT

REM: SEE CHART GET CHAIN FIND STRATEGIES
A large downside position targeted an obscure mortgage real-estate investment fund yesterday.

The iShares FTSE NAREIT Mortgage Plus Capped Index Fund fell 3.4 percent yesterday finish at $13.11, its lowest close since mid-January. The exchange-traded fund, which follows the performance of the residential and commercial mortgage real estate, was at a 52-week high of $15.65 in late September.

A trader bought 8,460 December 13 puts for the bid price of $0.55 on a wide bid/ask spread, according to optionMONSTER's Depth Charge tracking system. Open interest in the strike was only 10 contracts at the beginning of the day, so this is a new position.

The put buying wasn't tied to any trading in the underlying shares as identified by our scanners. It could be a hedge against an existing long stock position or an outright bearish play looking for shares to continue falling. (See our Education section)

Overall option volume in REM totaled 8,619 contracts, compared to a daily average of just 67. Only 37 calls changed hands in the entire session.
Share this article with your friends


OptionsHouse

Premium Services

Education & Strategy

Continue to melt up? Think debit call spreads

The U.S. equities market is continuing to melt up. Even though the labor market is stagnant, the Fed keeps hinting that a short term interest rate hike is coming sometime soon.

View more education articles »