Market Overview

Dan Nathan Sees Unusual Options Activity In PowerShares QQQ Trust, Series 1 (ETF)

Share:

Dan Nathan spoke on CNBC's Options Action about a trade in PowerShares QQQ Trust, Series 1 (ETF) (NASDAQ: QQQ) that caught his attention on Monday.

A trader decided to roll out his position and bought 25,000 contracts of the May 113 call options for $0.89, paying a premium of $2.3 million. The breakeven for this trade is at $113.89 or approximately 4 percent higher.

Nathan explained that implied volatility has decreased recently and index ETFs have generally lower options prices than single stocks. He added that this is a good way to get some cheap implied volatility exposure to the upside and define your risk.

Posted-In: CNBC Dan Nathan Options ActionOptions Markets Media

 

Related Articles (QQQ)

View Comments and Join the Discussion!
Lightning Fast
Market News Service
$199 Free 14 Day Trial

Fast Money Picks For March 3: General Motors, Coca-Cola, Cisco, Bank Of America

Dennis Gartman Is A Buyer Of iShares FTSE/Xinhua China 25 Index (ETF)