Bearish option traders are collecting big profits in the US Global Jets ETF (JETS) today.
On Jul. 20, Market Rebellion’s Unusual Activity Service found that 34,000 September $21 puts were bought for $0.52 as part of a bearish roll above the existing open interest of 1,252 contracts with shares at $21.81.
Those puts have traded for as much as $1.09 this session, a 109.62% return, while the stock fell 7.2% in the same time frame, illustrating the kind of leverage that can be achieved quickly with options.
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.
JETS was last down 2.31% at $20.28 today.
