The iShares MSCI Japan Fund is trying to rally off multi-year lows, but one option trader sees very limited upside.
The EWJ was up fractionally yesterday to close at $9.11. The exchange-traded fund was at a three-year low of $8.64 on June 1 and has been trying to recover since. Shares were above $10 in early April.
A trader sold 10,000 August 9 calls for $0.22 and another 21,000 for $0.23, optionMONSTER's systems show. Those were the bid prices at time, with volume dwarfing the open interest of just 845 contracts and therefore new activity.
The call seller is willing to sell the stock if it is above the $9 strike price at expiration, collecting the additional premium in the process. Some traders use such in-the-money or at-the-money call selling as a way to unload stock.
Total option volume in the name more than 31,000 contracts, compared to its daily average of 6,100.
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