40,000 AMJ Jan 2016 25 puts sold at .20.
The JP Morgan Alerian MLP index is trading at 28.66 today, up 1.20. AMJ has an IV30 of 38.39, an HV10 of 66.25%, an ADV of 6600 contracts and open interest of 139,661. The ETP saw a large put sale today, in which the trader sold 40,000 of the Jan 2016 25 puts at .20.? This is likely a close of a purchase of 40,000 Jan 25 puts on December 7th.
While this was traded naked it almost certainly is related to a large underlying stock position.?? At the time of the Dec 07 trade AMJ was about 3 bucks cheaper than it is now.? The customer likely feels like the heat is off the stock for the time being and wanted to salvage some dollars from the hedge.? Do not be surprised if we see a similar trade go up in Feb or March sometime after the new year set up as a hedge.
This trade should be considered aggressively bullish the stock and bearish volatility.