Mexico Put-Option Trades Jump to 21-Month High in U.S.

Bearish option trades on Mexican stocks jumped to the highest since March 2009 in the U.S. as investors boosted bets against an exchange-traded fund tracking 43 companies including America Movil SAB and Grupo Mexico SAB.

“There’s been aggressive buying,” said Chris Rich, head options strategist at JonesTrading Institutional Services LLC in Chicago. “Someone is obviously looking for some protection.”

More than 34,000 puts to sell the iShares MSCI Mexico Investable Market Index Fund changed hands as of 4 p.m. in New York, 36 times the four-week average and 10 times the number of calls to buy the ETF. The fund fell 0.1 percent to $61.19, paring its 25 percent rally this year. Almost two-thirds of all volume was concentrated in the January $61 puts, which rose 21 percent to $1.35.

Fifty-three percent of those contracts changed hands on the ask price, and today’s volume exceeded the open interest of 623 existing contracts before today, indicating that buyers of new bearish contracts initiated most of today’s transactions.

Mexico’s benchmark IPC Index rose less than 0.1 percent to 38,147.51.

To contact the reporter on this story: Jeff Kearns in New York at jkearns3@bloomberg.net.

To contact the editor responsible for this story: Nick Baker at nbaker7@bloomberg.net.

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