Trade sees ups and downs in utilities

optionMONSTER

The SPDR Utilities Fund slipped lower as the trade turned cautious near the long-term highs.

optionMONSTER systems showed that more than 20,000 XLU options traded, more than twice the daily average over the last month. The big print was a purchase of 14,000 September 37 puts at the $0.98 ask price. Previous open interest was just 441 contracts, so a new position was definitely begun.

A block of 560,000 shares was bought minutes later for $38.25 in the largest equity trade of the day. That would make it a delta-neutral play looking for higher implied volatility. The trader is therefore looking for a big move up or down in coming months.

XLU fell 0.21 percent to $38.09 and is back to levels last seen in September 2008. The stock has run up from support at $34 since mid-November.

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