10 ETFs With Heavy Call Options Flow: EEM, HYG, UNG, FXI and More

While many investors brush off options, many others like to “follow the flow.” In other words, they want to know what the big funds and institutions are doing. We can follow their footsteps when looking for unusual options activity.

Fortunately for Fintel readers, there’s a leaderboard of options activity for both calls and puts, helping us keep track of it all when we see outsized volume.

With that in mind, let’s look at 10 exchange-traded funds with heavy call flow over the last week. A few themes that stood out were: Emerging markets, China and corporate bonds.

iShares MSCI Emerging Markets ETF (EEM)

Leading off our top pick is the iShares MSCI Emerging Markets ETF (US:EEM), which received plenty of action on the bullish side over the last week.

There were some truly large trades, but the one that really stood out occurred when almost $140 million worth of the December 2023 $55 puts were sold. On its own, this would be a bullish position, although it’s more likely that this trade is connected to some other more complex options position.

Further, this trade was deep-in-the-money, with the EEM ETF trading at roughly $39 at the time of the trade.

There was another large put sale with a closer expiration, with someone selling roughly $15.5 million worth of the June $50 puts, as well as plenty of put sales in the March $44, $46 and $50 puts.

iShares China Large-Cap ETF (FXI)

The options flow in the iShares China Large-Cap ETF (US:FXI) is pretty straightforward. That’s after one trader sold $1 million of the June $26 puts on Feb. 24.

That trade came three days after another big trade saw someone buying $1.66 million of June $30 calls.

Those were the only two seven-figure trades of the week in the FXI ETF.

KraneShares CSI China Internet ETF (KWEB)

Another play on Chinese equities popped up, only this time it was a bit more specific, with the KraneShares CSI China Internet ETF (US:KWEB).

There are a number of smaller yet sizable six-figure trades that occurred last week. However, the two bullish trades that stood out the most both took place on Feb. 22.

That’s after someone sold the January 2024 in-the-money $32.42 puts for $1.07 million in premium. A few hours later, someone bought the August in-the-money $28 calls for roughly $470,000.

iShares iBoxx $ High Yield Corporate Bond ETF (HYG)

The action that we observed in emerging market ETFs, as well as corporate bond ETFs, led us to the iShares iBoxx $ High Yield Corporate Bond ETF (US:HYG).

For a big, liquid and popular ETF, it’s no surprise there are many large trades that take place in the HYG. However, it was hard to ignore when someone sold almost $40 million worth of the in-the-money March $95 puts when the HYG ETF was trading near $73.50.

iShares iBoxx $ Inv Grade Corporate Bond ETF (LQD)

There were some very high six-figure trades that took place in the iShares iBoxx $ Inv Grade Corporate Bond ETF (US:LQD).

However, the one that stood out was clear as one trader collected more than $5 million in premium by selling the March $106 puts. At the time of the trade, this position was just slightly out-of-the-money, with the LQD ETF trading near $107.25.

Energy Select Sector SPDR Fund (XLE) 

Energy remains the best-performing sector over the last 12 months, even though that’s not been the case so far in 2023. Regardless, someone is bullish after the latest pullback in the Energy Select Sector SPDR Fund (US:XLE).

That someone sold $4.5 million worth of the in-the-money March $100 puts (when the XLE ETF was trading at $83.50). They also sold $2.28 million of the March $95 puts.

While another trade did sell almost $850,000 of the June $100 calls, it’s certainly overshadowed by the put sales.

United States Natural Gas Fund, LP (UNG)

Natural gas has been in a world of hurt. The commodity itself declined 74% from the November high down to last week’s low. When measured from the August high, it has fallen more than 80%. At one point in that stretch, natural gas prices had declined in 19 out of 24 weeks.

As one would expect, the United States Natural Gas Fund (US:UNG) also fell hard. However, both the UNG and natural gas prices have been rallying hard over the last few days and at least a few traders think that the rally can continue.

That’s as someone bought almost $2.2 million worth of the April $8 calls, which are in-the-money. It also includes almost $500,000 worth of the January 2024 $8 calls.

One bearish trade that stuck out was the $689,000 worth of the June $10 calls that were sold; although to be fair, this could also be a component of a bullish spread.

iShares US Home Construction ETF (ITB)

Despite rising interest and mortgage rates, the iShares US Home Construction ETF (US:ITB) has continued to perform quite well this year. After a modest pullback, one trader is particularly bullish.

That’s after they sold the slightly in-the-money March $69 puts, collecting almost $2.2 million in premium for the trade. With shares trading near $66.50, this trader has just three weeks left in the position before it expires.

Technology Select Sector SPDR Fund (XLK)

The Technology Select Sector SPDR Fund (US:XLK) is quite interesting, as there was a ton of bearish options flow last week, yet the trade that stuck out the most was a bullish put sale.

That’s after someone sold $1.8 million of the June $140 puts, when the XLK ETF was trading near $143.

VanEck Gold Miners ETF (GDX)

Last but certainly not least, we have the VanEck Gold Miners ETF (US:GDX), which saw a wave of bullish options bets on Feb. 24.

That was led by one trader paying almost $600,000 in premium for the June $28 calls. The position was only slightly out-of-the-money with the GDX trading near $27 at the time of the trade.

There was also almost $400,000 in premium purchased in the January 2024 $30 calls, $172,500 worth of premium in the January $28 calls, and several $65,000 to $90,000 in call premium spent on March and April call trades.

This article originally appeared on Fintel

By Bret Kenwell