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Options Trading News

June 5, 2013  Wed 4:14 AM CT

The iShares 20+ Year Treasury Bond Fund fell along with stocks yesterday, but one short-term trader is looking for a floor.

The biggest single trade came right at the closing bell, when optionMONSTER systems show that a trader sold 4,674 Weekly June 111 puts for $0.20. The put seller is betting that the TLT will hold above the $111 strike price through the end of this week, when the contracts expire. This is clearly a new position because the strike's previous open interest was just 585 contracts. (See our Education section)

The TLT fell 0.92 percent finished the day at $113.72, its lowest close in at least a year. Shares were above $124 only a month ago.

The exhange-traded fund has been falling with equities as Federal Reserve officials have discussed tapering the central bank's monetary-easing policies. The correlation between the TLT and the S&P 500 is usually very negative, around -0.8 or lower, but it has risen to 0.6--the highest in a year. 
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