Shares of the Market Vectors Oil Services ETF (OIH) are trading lower on the session by 1.13%, at $41.99. The ETF has been on a tear over the past three months as service names like National Oilwell Varco (NOV) and Schlumberger (SLB) rally to three-month highs.?
Traders were hitting the puts aggressively this morning, though, betting that the OIH will pullback through $42.00 this week. The heaviest action is coming on the September $42 strike, where 21,000 contracts have traded on open interest of only 8,955.
The action started with the purchase of 5,118 contracts for $0.25, then 3,257 puts were bought for $0.30-0.35, and then 2,644 puts were bought for $0.45. All trades have gone off on the offer.
Overall put volume is now running at 2x the daily average with 21,617 puts traded.
Near-term implied and historical volatility is registering 25% and 18%, respectively.
The Market Vectors Oil Services ETF seeks to replicate as closely as possible before fees and expenses the price and yield performance of the Market Vectors US Listed Oil Services 25 Index. The fund normally invests at least 80% of its total assets in securities that comprise the fund’s benchmark index.