Learn the trade here. Make it on tradeMONSTER

Options Trading News

June 6, 2013  Thu 4:14 AM CT

IWM: SEE CHART GET CHAIN FIND STRATEGIES
A big put spread topped yesterday's option activity in the iShares Russell 2000 Fund.

optionMONSTER systems show that a trader bought 19,000 each of the June Quarterly 94 and 82 puts for $1.15 and $0.06 respectively. At the same time he or she sold 38,000 of the 88 puts for their bid price of $0.25.

This butterfly spread cost $0.71 to open, which is the maximum loss on the trade and would be realized if it is held until expiration and shares are either above $94 or below $82. The theoretical maximum gain of $5.29 would be realized with the fund at $88. (See our Education section)

The IWM fell 1.28 percent to $96.43, its lowest close since May 9. The exchange-traded fund, which tracks the small-cap index, was above $100 last week. It has not traded at $88 since mid-January and below $82 since early December.

Total option volume in the IWM was 811,000 contracts yesterday, with puts outpacing calls by more than 2 to 1.
Share this article with your friends


Premium Services

Education & Strategy

Options and high-frequency trading

There has been much talk lately of high-frequency trading (HFT) and what it does--or doesn't--mean to the markets and retail...

View more education articles »
optionMONSTER stockMONSTER tradeMONSTER