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Trader sees floor in homebuilders

Chris McKhann (chris.mckhann@optionmonster.com)

The SPDR Homebuilders Fund has been rebounding recently, and one trader is apparently believes that any downside will be limited through next spring.

optionMONSTER systems detected the sale of 5,000 March 27 puts in one block for the bid price of $0.57. The volume was twice the strike's daily average for the last month, so this is a new position.

The put seller is looking for the XHB to hold above $27 through mid-March. The trader is also taking on the risk of having to buy shares if they fall below that strike price. (See our Education section)

The XHB is up 1.84 percent to $31.11 this morning. It has been climbing for the last three days after trading below $29 two weeks ago. The exchange-traded fund was above $32 in mid-September and last below $27 on the last day of 2012. 

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