Mike Khouw Sees Unusual Options Activity In iShares Russell 2000 Index (ETF)

On CNBC's Options Action, Mike Khouw spoke about a huge bearish options trade in iShares Russell 2000 Index (ETF) IWM. The put options trading volume on Tuesday was two times higher than the average daily put options volume and Khouw noticed one big trade that stood out from the others. A trader bought 111,000 May 107/90 put spreads for $2.10, paying a total of $23.3 million in premium. The trade breaks even at $104.90 or 12.5 percent lower from the current price of the iShares Russell 2000 Index (ETF). It can maximally make $14.90 or $165.39 million, if the stock drops to $90, which is 25 percent lower from the current price.