Retail ETF faces downside spread

optionMONSTER

The SPDR S&P Retail Fund climbed to a new all-time high on Friday but saw a large put trade just before the closing bell.

A trader bought 5,000 June 75 puts for $1.20 and sold 10,000 June 73 puts for their bid price of $0.76, according to optionMONSTER's Depth Charge system. This was clearly new positioning, as the open interest at each strike was below 2,000 contracts before the session began.

The trader spent $0.44 to open this vertical spread , which is the maximum potential loss. The maximum gain of $1.56 would be realized if the XRT is below $73 at expiration in mid-June. (See our Education section)

The XRT was up 1.43 percent on Friday to close at $76.45, a record closing and intraday high. The exchange-traded fund was below $73 just the previous Thursday.

Friday's total option volume in the XRT was 53,304, compared to a daily average of 17,000 in the last month.


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