A large downside position leads early option activity in the SPDR Oil & Gas Exploration and Production Fund as shares fall.
optionMONSTER systems show that a block of 5,000 July 71 puts was bought for the ask price of $1.81 this morning. Open interest in the strike was a mere 7 contracts before the trade appeared, so it is clearly a new position.
The put buying isn’t tied to any trading in the underlying shares identified by our systems, so it could be an outright bearish play. But it is also very possible that this is a hedge on a long position in the XOP or its component companies.
— Option Monster