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Global ETF draws huge call buying

Chris McKhann (chris.mckhann@optionmonster.com)

Huge call purchases topped yesterday's option action in the global iShares EAFE Index Fund.

More than 124,000 December 67 calls traded, and optionMONSTER's Heat Seeker system shows that 121,121 of those were bought. The first big block of 56.089 went for $0.34 during the lunch hour, and another print of 55,242 was purchased for $0.39 about an hour before the closing bell.

These are clearly new positions, as the volume was far above the strike's previous open interest of 27,940 contracts. The trades pushed the EFA's total option volume just past 150,000 contracts--6 times its daily average for the last month.

These long calls could be a cheap, short-term bet that the exchange-traded fund--which tracks stock indexes in Europe, Asia, and Australia--will be at new highs in the coming weeks. But the upside options could also be part of any number of other strategies, including stock replacement. (See our Education section)

The EFA finished the day up 0.63 percent to $65.96, in the middle of its recent range. Shares hit a five-year high of $66.96 a month ago.

(A version of this post appeared on InsideOptions Pro yesterday.)

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