Bears score again in $INDA

Bearish iShares MSCI India ETF (INDA) option traders who opened downside positions less than a month ago are collecting large profits once again today.

On Feb. 27, our Unusual Activity Tracking systems found that 7,400 April $33 puts were bought for $1.00 to $1.05 with shares at $33.24. This was clearly fresh buying, as open interest was just 124 contracts in the strike before the session began.

Those puts traded for as much as $12.00 today, or about 12 times their purchase price. The stock declined 36.88% in the same time frame, showing how quickly options can far outperform moves in their underlying shares on a relative basis.

It is the second winning trade in the ETF to be posted by Market Rebellion in the past month.

Long puts lock in the price where a stock can be sold no matter how far it might drop, gaining value in a selloff with the potential for significant leverage. The contracts can be purchased either as an outright bearish bet or a hedge on a long-stock position.

INDA ended today down by 10.19% to $20.72, levels not seen since 2013. The iShares MSCI India ETF, which tracks a basket of Indian equities, has fallen as the global economic impact stemming from the COVID-19 Coronavirus is weighed by markets.