How big call trade is playing the QQQ

optionMONSTER

The PowerShares QQQ Trust attracted an unusual call spread yesterday.

optionMONSTER's system shows that a trader sold 15,000 April 68 calls, led by a block of 10,000 that went for $1.24, and sold 30,000 April 71 calls that included a print of 20,000 for $0.31. The volume at each strike was well above the previous open interest, so this is a new backspread .

The position takes in a credit of $0.62, which will be the profit if the QQQ remains below $68. The trader can also profit if shares move sharply higher, as he or she owns twice as many of the higher-strike calls. (See our Education section)

The QQQ finished the day down fractionally at $67.24. The exchange-traded fund has been in a relatively tight range since the start of 2013, between $66.20 and $67.70. And while its 20-day historical volatility has picked up with the action of the last four sessions, it was at a 52-week low below 8 percent.  

Total option volume in the fund was more than 278,000 contracts, about 100,000 more than its daily average in the last month.

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