Dan Nathan's SPDR S&P 500 ETF Trade

Dan Nathan spoke

about an options strategy that could be profitable if the S&P 500 trades higher by the end of the year and it declines in the first quarter. Specifically, he wants to sell the December quarterly 190 put option in

for a premium of $3.40 and buy the March quarterly 190 put for $6.40. He would have to pay a net premium of $3 for this trade and if the SPDR S&P 500 ETF trades above $190 at December expiration and below $187 at March expiration the trade will be profitable. When the shorter date option expires, traders can continue to manage the trade and turn it to a vertical put spread.