On the back of today’s better than expected retail sales data we are seeing some big money move into the retail space.  These investors are snatching up call options on the retail ETF with the hopes of a continued consumer rebound:

XRT – SPDR S&P Retail ETF – With September’s retail sales surprisingly strong compared to predictions of a larger decline, shares at the retail ETF are 1.6% higher at $35.95. the rally appears to have inspired one investor to purchase a block of 15,000 in-the-money call options expiring in December for a 2.90 premium. The share price by expiration must be above $36.90 in order for this transaction to make money, but the tactic is most likely to achieve a longer-term stake in shares at retailing companies since the investor chose a higher delta (in-the-money) option. Elsewhere the November 37 strike calls were bought 10,000 times at a premium of 80 cents with investors hoping for ongoing consumer-led strength.

Source: IB