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One investor is using options to protect against junk bonds getting trashed.

Our Depth Charge monitoring system detected the purchase of 5,000 March 90 puts on the iShares iBoxx High-Yield Corporate Bond exchange-traded fund for $2.55. An equal number of March 85 puts were sold at the same time for $1.05. Volume was more than 30 times open interest at both strikes, indicating that new positions were initiated in each.

The option trade cost $1.50 and will earn a maximum profit of 233 percent if the fund closes at or below $85 on expiration. It's known as a bearish put spread because it leverages a move between two price points.

The HYG is off 0.29 percent to $92.08 in midday trading. Junk bonds tend to follow sentiment in the stock market, so the fund has been melting higher along with the S&P 500.

Today's bearish trade is probably the work of an investor who owns HYG but wants insurance against a pullback . (See our Education section)

Overall option volume is quadruple the daily average so far in the session, with puts outnumbering calls by 63 to 1.

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