Mike Khouw Sees Unusual Options Activity In Market Vectors Semiconductor ETF

Mike Khouw spoke on CNBC's Options Action about a bearish options activity in Market Vectors Semiconductor ETF SMH. He said that the put options volume was three times higher than the average daily put options volume and the most active were the December expiration put options. Khouw noticed that somebody bought 10,000 contracts of the December 54 / 50 put spread and paid a dollar for it. The break even for the trade is at $53 and if the stock drops to or below $50, the maximal gain for the trade is going to be $3. The trader is betting that Market Vectors Semiconductor ETF is going to trade approximately 9 percent lower from its Monday's closing price.