Sep. 3 at 12:30 AM
Brazilian stocks are gaining momentum after a months-long sell-off from six-year highs reached in April. The iShares MSCI Brazil ETF is up more than 12% from last month’s lows and 19% year to date, outperforming the Nasdaq-100’s 15% gain.
The rally may be driven by surging commodity prices or optimism ahead of Brazil’s October general election. Options traders are also taking increasingly bullish positions: EWZ options volume exceeded six times its 30-day average on Wednesday, with more than 420,000 contracts traded by midday.
Calls overwhelmingly dominated activity, with about 400,000 calls versus fewer than 30,000 puts. Nearly all of the
$50 million in options premium traded was tied to calls, although substantial call selling suggests some traders may be using bullish spreads or strategies designed to profit from elevated volatility. Implied volatility has risen from 0.28 to 0.39, making EWZ options among their most expensive since late June
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