Tony Zhang Sees Unusual Options Activity In ARK Innovation ETF

On

Tony Zhang spoke about unusual options activity in

. The ETF traded almost 20% lower in the last three weeks and during the sell-off, on Thursday, the options volume was four times the average daily volume, said Zhang. He saw a fairly unusual trade in the name. There was a purchase of 4,000 contracts of the May $85/$102/$109 call spread risk reversal at $1.47. The options structure is pretty common, but it is unusual that it expires next Friday. The trader sold the May $85 put, bought the May $102 call and sold the May $109 call for a debit of $1.47. The trade breaks even at $103.47 or around 4% above the closing price on Thursday. Its maximal profit is $5.53.