Bears short NDX through leveraged fund

optionMONSTER

As stocks took a breather from record gains yesterday, some traders were looking to short the Nasdaq 100.

The ProShares UltraPro Short QQQ Fund, which is designed to provide 3 times the inverse of the daily performance of the NDX, rose 1.23 percent to close at $33.82. The SQQQ, which has only been around since February 2010, saw more than 10,000 option change hands versus its daily average of 1,200.

optionMONSTER systems show that the action was almost entirely in the April 35 calls, which traded 9,301 contracts. The big print of 8,795 was purchased for the ask price of $1.25 against open interest of just 208 before the session began, so these long calls are clearly new positions. (See our Education section)

Despite this action, the SQQQ remains just above its all-time low of $33.34 reached last Friday. The exchange-traded fund posted a lifetime closing low on Monday, just above that level. 

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