Active trading in the Dow Jones Industrial ETF (DIA), which is down $1.39 to $127.37 and not far from session lows late-Friday. 95,000 contracts traded on the fund, which is 3X the normal volume for the DIAMONDS. 36,000 calls and 59,000 puts so far. The top trade is a Mar Quaterly 127 – 128 strangle, bought for $5.90, 10000X. The hefty premium purchase appears to be a new position and was possibly initiated to hedge the risk of heightened market volatility through the rest of the first quarter. Implied volatility in DIA, which is designed to equal roughly 1/100th of the Dow, is moving up 18.5 percent to 17.
Category: All ETFs
About the Author (Author Profile)
Frederic Ruffy is a well-known trader, writer, and strategist who has spent years educating investors and creating intelligent, insightful, unbiased market observations that are frequently cited by the Wall Street Journal and other financial publications. As senior analyst, Fred provides frequent and regular notes and daily updates for activity of interest.