Likely a hedge fund or other big institutional trader, the deal is betting that the S&P 500 will fall below 700 by April.

 

In a move that drew mixed responses from money managers on Thursday, one investor bought an estimated $4.8 million worth of put options on shares of the SPDR Trust (NYSE: SPY).

Options houses reported that a single unknown buyer transacted 34,000 April puts on the exchange-traded fund at a strike price of $70, according to Reuters.

Traders say it’s likely a hedge fund manager or other type of institutional portfolio manager with enough assets to try to game the market took advantage of an otherwise slow day for such transactions. 

“This seems like a very aggressive move. The options they went long on expire in April. So it looks like they’re protecting themselves against the S&P 500 falling as much as 17% between now and then,” said

…

a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="http://1.bp.blogspot.com/_28p7XDn4Qb0/SVNqgZKeabI/AAAAAAAABVo/TSXbAwbCBG0/s1600-h/ScreenHunter_1.jpg"img style="margin: 0px auto 10px; display: block; text-align: center; cursor: pointer; width: 400px; height: 125px;" src="http://1.bp.blogspot.com/_28p7XDn4Qb0/SVNqgZKeabI/AAAAAAAABVo/TSXbAwbCBG0/s400/ScreenHunter_1.jpg" alt="" id="BLOGGER_PHOTO_ID_5283683892578904498" border="0" //abr /Picture above shows one year charts for United States Oil fund (USO), PowerShares Bullish US dollar index (UUP) and SPDR Trust (SPY). You can see there is a inverse correlation between the value of US dollar and crude oil prices. Slide from record crude prices $ 140 triggered US dollar rebound. In last days EURO and other currencies are re-gaining back ground against US dollar but crude oil is heading still down.br /Another indication of possible turnaround are equities. Global markets found their short term bottom on November. And crude oil price usually follow stock markets peak or bottom with some delays.div class="blogger-post-footer"http://stockweb.blogspot.com/atom.xml/div pa href="http://feedads.googleadservices.com/~a/-oMhjUyuDIqDAFZXyfsjNbRAzV0/a"img src="http://feedads.googleadservices.com/~a/-oMhjUyuDIqDAFZXyfsjNbRAzV0/i" border="0" ismap="true"/img/a/pdiv class="feedflare" a href="http://feedproxy.google.com/~f/Stockweb?a=XDzsNI1C"img src="http://feedproxy.google.com/~f/Stockweb?d=41" border="0"/img/a /div

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Editor's Note: The following is a roundup of what others are writing about exchange-traded funds, index mutual funds and indexes. This column is updated throughout the day by IndexUniverse.com's staff.  Suggestions are welcome by sending comments or links to: <!-- var prefix = 'ma' + 'il' + 'to'; var path = 'hr' + 'ef' + '='; var addy98263 = 'mcoleman' + '@'; addy98263 = addy98263 + 'indexuniverse' + '.' + 'com'; document.write( '' ); document.write( addy98263 ); document.write( '' ); //-->mcoleman@indexuniverse.com. 

 

Look Who's Talkin'

You've heard it all before. But for the uninitiated, we're providing a link to our own Matt Hougan, who was grilled by reporter Trang Ho for this Q&A appearing in Investor's Business Daily on Tuesday.

Hougan comes through, providing what IU.com readers have become accustomed to -- unblinking analysis and fiercely independent commentary on everything relating to ETFs.

You can see

...

Thursday November 13, 2008 Navivest

After three consecutive down sessions, stocks might be looking to rebound today. Assuming that the lowered Q4 guidance announcement from Intel yesterday or some other bad news does not overwhelm the market, we could get a rally that feeds itself.

If stocks start moving to the upside, then investors and traders who are sitting on the sidelines might get in, which could create a buying frenzy.

Word of caution, watch the markets carefully and make sure that we do have a positive day ahead of us. Obviously if we are in store for a bullish day, you do not want to wait until the markets have rallied before getting in, but we don’t want to get caught in a bearish trap.

Wait for the first 15 to 30 minutes of trading and if stocks are up, we have decent buying volume and we have a bullish advance

...

Market Index FundMarket Index Fund InvestmentsEver wonder what hedge funds use when they just want to go along with an index, reaping the gains from a possible rally or helping to diversify and take risk out of their potfolio equation? That’s a no-brainer; just buy shares of a tracking index. QQQQ for the NASDAQ, DIA for the Dow Jones, IWM for the Russell 2000 and SPY for the S&P 500 are all vehicles of choice if you wish to track tick for tick an index. Compiling data from TickerSpy’s database of hedge funds shows that 61 have a position in the market index itself. The most popular by far is the SPY, numbering 37 out of the total 61 funds currently holding a position indirectly in the US markets.So, what is the SPY? Technically ...

Tudor Hedge FundTudor Hedge Fund 13F Holdings AnalysisThis post is being written as part of HedgeFundBlogger.com's Investment Securities Tool which analyzes the holdings of hedge fund managers.Next up in the macro hedge fund tracking series we have Tudor Investment Corp, the brainchild of Paul Tudor Jones. Taken from Wikipedia, the bio of PTJ is as follows: "In 1980 he founded Tudor Investment Corporation which is today a leading asset management firm headquartered in Greenwich, Connecticut. The Tudor Group, which consists of Tudor Investment Corporation and its affiliates, is involved in active trading, investing and research in the global equity, venture capital, debt, currency and commodity markets. One of Jones' earliest and major successes was predicting Black Monday in 1987, tripling his money during the event due to large short positions. Jones uses a global macro ...

Demolition spreads past financials into broad sell-off; meanwhile, GLD soars and bonds avoids heavy damage.

 

It was a brutally down day on Wall Street by just about any measure on Monday. And exchange-traded funds were not spared any of the punishment.

With the Dow Jones Industrial Average suffering its biggest single-day drop ever (777 points, or a loss of 6.98%), all the broad market equity ETFs received a complementary backlash, and the beating was no longer focused on financial ETFs.

The SPDR Trust (AMEX: SPY) hit a 52-week low mark of 110.97, before closing at 111.38, a 9.47% drop for the day. The S&P 500 Index was down 8.79% for the day, and the Nasdaq Composite was down 9.14%. The Dow's massive loss was not among its 10-biggest drops ever on a percentage basis, but avoiding placement in that infamous group provided little reason to celebrate.

The Diamonds Trust (AMEX: DIA) closed at a 52-week low of 104.75, down 6.40% for

...