Materials ETF Sees Heavy Call Buying

By Pete Najarian, co-founder of OptionMonster

The Materials Select Sector SPDR (XLB Quote) exchange-traded fund has risen 50% since its March lows, and options traders are betting that it still has some fuel left in the tank.

More than 71,000 calls changed hands at the June 28 strike Wednesday, including a single chunk of 49,900 bought for 90 cents, according to OptionMonster's tracking systems. The average daily volume at that strike is just 38 calls, and open interest was 1,072 contracts.

The ETF closed Wednesday up 0.45% to $27. It reached its 52-week low of $17.83 on March 6.

The ETF, which combines agriculture, chemical, and metals names, has ramped higher along with the rise in commodities.