Bearish Options Player Fashions Put Butterfly Spread on Retail SPDR ETF

Today’s tickers: XRT, TSN, CVS & AXL XRT  - SPDR S&P Retail ETF –  A large bearish put butterfly spread on the retail ETF this afternoon suggests one options strategist is positioning for a pullback in the price of the underlying ahead of May expiration. Shares in the XRT, an exchange-traded fund that tracks the performance of the S&P Select Industry Index, are down 0.20% to stand at $51.87 as of 12:30pm in New York. The pessimistic player traded a total of 80,000 put options on the fund, driving most of the volume generated on the XRT thus far in the session. It looks like the trader picked up 20,000 puts at the May $47 strike at a premium of $0.37 each, sold 40,000 puts at the May $49 strike for a premium of $0.67 apiece, and purchased 20,000 May $51 strike puts at a premium of $1.27 a-pop. The net cost of establishing the put ‘fly amounts to $0.30 per contract and positions the retail-bear to make money in the event that shares in the ETF fall another 2.3% from the current price of $51.87, to breach the upper breakeven price of $50.70 by May expiration day. Maximum potential profits of $1.70 per contract are available to the investor should shares in the fund fall 5.5% to settle at $49.00 at expiration. Enacting this strategy significantly reduces the overall cost of taking a bearish stance on the retail sector, as opposed to buying the May $51 strike puts outright or purchasing a debit put spread, for example. Additionally, the put ‘fly requires relatively smaller downside moves in XRT shares before the position to breaks even than the aforementioned strategies. TSN  - Tyson Foods, Inc. –  Investors lunched on Tyson call options today with shares in the meat manufacturer rising as…
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