SLV Sees Massive Bearish Options Trade Despite Silver's Rise

The iShares Silver Trust SLV, the largest ETF backed by holdings of physical silver, has jumped more than 8% in the past week and has surged almost 124% in the past year. Silver is also once again trading around 31-year highs, but that didn't stop a large bearish options bet on the ETF today. A trade of 100,000 July 25 puts in SLV, equal to $1 million, was spotted earlier today. The puts changed hands at the ask price of about 10 cents and exceeded the open interest of 6,054 outstanding contracts before today, indicating that a buyer of a new bearish position initiated the transaction, according to Bloomberg News. That's betting on a 37% drop for an ETF that has been on fire and hasn't traded below the strike price in nearly six months. The trade accounted for almost two-fifths of the 257,312 silver ETF puts changing hands today, the most since November and triple the four-week average, Bloomberg reported. Given that the options are so deep out-of-the-money, the trader could be betting on just a small pullback in silver that could spart the price of the puts higher.