Earlier this morning at approximately 8:49AM CST, we detected and flagged some unusually large bearish activity in the Utilities Select Sector SPDR ETF (XLU). The most notable trade to hit the tape at this time was a large buy of over 5,300 Jun 44.0 strike puts which were purchased at the ask for $1.04. This block-buy came on the heels of several other sizable trades that had already amassed thousands of contracts bought up at the ask just prior. It appears a significant bearish position is being established in the energy utility ETF, betting on about a four point move lower by the June 19th 2015 monthly options expiration.
As of the time of this post, over 12,200 total contracts have traded already in the Jun 44.0 puts, and the XLU has now traded over 2.5x its average daily options volume.
Trade: I bought 200 of the XLU Jun 44 Puts for $1.05
Risk: $105 per 1 lot