Option bears triple their money in $XRT

Option bears triple their money in $XRT


Bearish option traders have tripled their money on downside positions in the SPDR S&P Retail Fund (XRT) today.

On Feb. 17Market Rebellion’s Unusual Option Activity Service found that 4,000 March $72 puts, expiring this Friday, were bought for $3.32 as part of a bearish spread above the existing open interest of 2,049  contracts with shares at $70.46.

Those puts have traded up to $11.58 this session, over 3 times their purchase price. The ETF fell 14.55% at the same time, showing how quickly options can far outpace gains in their underlying shares.

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.

The XRT was last lower by 0.58% at $61.20 this afternoon.

Ready to start trading? Try Unusual Option Activity Essential. Learn how you can follow the “smart money” with a fresh UOA trade idea each week – including technical levels so that you know how to manage each trade!

Subscribe to Rebel Roundup for your weekly digest of market highlights and free trading lessons.
We’re on a mission to empower retail traders with the tools they need to succeed.

Join a growing community of traders with Market Rebellion

Join the thousands of users daily!