Dan Nathan Sees Unusual Options Activity In iShares Russell 2000 Index

On CNBC's "Options Action", Dan Nathan spoke about an unusually high options activity in iShares Russell 2000 Index IWM. He noticed a big put options activity as put volume in the name was 1.5 times that of calls.

When the stock was trading at $142, a trader bought 7,500 contracts of the May 135 puts for $4.50. The trade breaks even at $130.50 or 8.68 percent below the closing price on Wednesday. Nathan explained that this could be an outright bearish bet, but it could also be a hedge for a portfolio of small-cap stocks.