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One of the hottest trades of the past year might have run its course, if one options trader gets their way.
In one of the most interesting macro trades of the day, someone sold upside call exposure in the SPDR Gold ETF (GLD)
while simultaneously buying downside put exposure in a two-pronged trade that both brings in a million-dollar credit and creates potential for big gains if GLD drops at least 15% by mid-July.
The trader sold 4,000 of the $450-strike GLD calls expiring July 17 for a credit of $3.1 million, then bought 8,000 of the $360-strike puts expiring the same day for $2 million. That means as long as GLD stays below $450 by expiration, the trader is essentially getting paid to take a long-shot bet on a big crash in gold.
