OptionsHouse

Options Trading News

September 21, 2016  Wed 6:45 AM CT

EWW: SEE CHART GET CHAIN FIND STRATEGIES

The iShares MSCI Mexico Index Fund has dropped sharply in the last month, but one large trader is betting that further declines will be limited.

optionMONSTER's tracking programs detected the sale of 6,000 December 44 puts for $1.44 to $1.47 at the same time yesterday. Volume surpassed the strike's open interest of 2,159 contracts, showing that this is a new position.

Short puts lock in a price where investors must buy a stock, while letting them collect premium. Traders use the technique when they like a stock and think that the risk of a big drop is limited. (See our Education section)

EWW fell 0.11 percent to $46.67 yesterday and is down 12 percent in the last month. Overall option volume in the fund was twice its daily average.

Share this article with your friends


OptionsHouse

Premium Services

Education & Strategy

Using spreads to minimize risk

Last week we discussed the risk vs reward profile of a debit call spread in Wells Fargo (WFC). This week we will run thru the risk vs reward of selling a credit put spread to achieve the same exposure of that debit call spread.

View more education articles »