Market Overview

Alon Rosin's SPDR S&P 500 ETF Trust Trade

Share:
Related SPY
Bill Gross: If A Global Recession Happens, You Can Blame Central Banks
The Market In 5 Minutes
Money Matters Financial Group Inc Buys iShares MSCI EAFE, PowerShares QQQ Trust Series –, ... (GuruFocus)

Alon Rosin of Oppenheimer & Co. said on Bloomberg Markets that investors should consider a bearish options strategy in SPDR S&P 500 ETF Trust (NYSE: SPY).

He wants to buy the 1 to 1.5 put spread ratio. Specifically, he wants to buy the September 235 put and sell 1.5 September 220 put for a total cost of $1.10. The trade breaks even at $233.90 or 4.14 percent lower. It can maximally make a profit of $13.90, if the stock drops to $220. Below $220, the trade starts to lose money. Rosin explained that he likes the structure mainly because of the skew. The out of the money puts are more expensive than the at the money puts.

Posted-In: Alon Rosin Bloomberg MarketsMedia ETFs

 

Related Articles (SPY)

View Comments and Join the Discussion!