Options News
$ITB put buyers double money
Option traders have scored fast gains on downside positions in the iShares U.S. Home Construction Fund (ITB). On Feb. 17, Market Rebellion’s Unusual Activity Service found that 4,000 Weekly $67 puts, expiring this Friday, were bought as part of a bearish spread and roll for $1.20 against no existing open interest with shares at $67.50. Those puts […]
Option traders have scored fast gains on downside positions in the iShares U.S. Home Construction Fund (ITB).
On Feb. 17, Market Rebellion’s Unusual Activity Service found that 4,000 Weekly $67 puts, expiring this Friday, were bought as part of a bearish spread and roll for $1.20 against no existing open interest with shares at $67.50.
Those puts have traded up to $3.14 today, over 2.5 times their purchase price. The stock declined 4.96% in the same time period, a large move but nowhere near that of its options on a relative basis.
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.
ITB was last lower on the day by 4.00% to $64.15.