Bearish Options Bets Circle Oil & Gas Producer ETFs Amid Crude’s Slide

Today’s fund flows update from Paul Weisbruch of Street One Financial points out the relentless recent downside momentum in crude oil prices, and subsequent bearish options bets beginning to be placed against oil & gas producers.

The continuous pressure in Crude Oil prices lately, with the largest tracker USO (U.S. Oil) trading below $10 today after another gap down, has led to additional bearish speculation in the Energy Exploration & Production space. XOP (SPDR Oil & Gas Exploration & Production) May 33 puts are trading, and these short dated options are just a bit out-ofthe-money at present levels.

XOP is down over 3% this morning, along with other Energy equity names such as XLE (SPDR Energy, -1.6% on the day so far), amid the relentless slide in Crude Oil prices, and commodity prices in general. Note that gold (GLD) and silver (SLV) are also down around 1% each today as well.

The SPDR S&P Oil & Gas Exploration & Production ETF (NYSE:XOP) was trading at $33.47 per share on Thursday morning, down $1.22 (-3.52%). Year-to-date, XOP has now declined -19.19%, versus a +6.70% rise in the benchmark S&P 500 index during the same period.

XOP currently has an ETF Daily News SMART Grade of C (Neutral), and is ranked #16 of 38 ETFs in the Energy Equities ETFs category.


Disclaimer: The content of this article is excerpted from a daily newsletter from Street One Financial. While ETF Daily News may edit the contents and add a relevant title to the piece, the author, Paul Weisbruch, does not endorse or recommend any issuer or security mentioned herein.

About the Author: Paul Weisbruch

paul-weisbruchPaul Weisbruch is the VP of ETF/Options Sales and Trading at Street One Financial. Prior to joining the team at Street One, Paul served as the Director of RIA and Institutional ETF Sales at RevenueShares ETFs from December 2007 until November of 2009. Before RevenueShares, Paul was employed by Susquehanna International Group from 2000 until 2007 serving in roles including OTC/NYSE Institutional Block Trading, Nasdaq/OTC Market Making, ETF/Derivatives Intelligence and Strategy, Algorithmic Trading, as well as acting as the PHLX Floor Specialist in the ETFs, SPY and DIA.Paul has been actively involved in the ETF space from both a product and trading standpoint since 2000. Additionally, Paul has well forged relationships with national RIAs, institutional pension fund managers and consultants, mutual fund and hedge fund managers, and also the ETF media. Co-authoring the “S1F ETF Daily” since 2009, the daily piece has become a must for many portfolio managers in the ETF space, with segments regularly appearing in the likes of Barron’s, WSJ, and ETFTrends.com for instance.

He holds his Series 4 (Registered Options Principal), 6, 7, 55 (Equity Trader), 63, and 65 licenses. He graduated from the University of Pittsburgh (B.S. – Economics), graduating magna cum laude, and has an MBA from Villanova University.