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Big bet on emerging markets

One investor thinks that emerging markets are ready for a comeback.

optionMONSTER's Heat Seeker tracking program detected the purchase of 100,000 January 42 calls on the iShares MSCI Emerging Markets Index fund for $2.35. An equal number of January 47 calls were sold for $0.65, and volume was more than triple open interest in both strikes.

The trade cost $1.70, and has the potential to earn 194 percent if the fund closes at or above $47 on expiration. It took place in two giants blocks during the last 10 minutes of trading, making it by far the largest transactions in yesterday's session.

EEM closed down 0.28 percent to $39.88. It's been lagging the broader market all year as investors worry about inflationary pressures in countries such as China and Brazil. But some of those concerns may be abating now -- especially after Brazil cut its interest rate two weeks ago.

Overall options volume in the fund was more than twice the average amount in the session, according to Heat Seeker.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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