????????????????????????????????????????????
??
EWC
IShares MSCI Canada Index (trading $25.70 with an IV30 of 12.90 and an HV10 11.35) saw a large bearish butterfly trade today.? The customer bought 10,000 of the December 23 puts for $.40; the customer sold 20,000 of the Dec 21 puts, and bought 10,000 of the Dec 19 puts for $.15.? Net the customer bought 10,000 of the Dec 23/21/19 put butterflies for .15.?
This is an ETF that trades an average of 825 contracts a day and has OI of only 39,483.? Thus one trade was more contracts than the total open interest.
This appears to be a hedge.? The customer is paying .15 to have a position protected down to 21 dollars a share.?? With the stock around 25.70 that would be a near 20% drop in the underlying that this position would hedge properly.? Considering this is a Canadian ETF and not a stock it would take a major issue with oil and the loonie to cause such a precipitous drop.
This trade is bearish EWC and mildly bearish volatility.