December VIX settlement was last week and traders are starting to look to next year. Late Monday afternoon one of these traders took a position looking for VIX to return to the low teens in early 2015.   With VIX around 15.70 and the January VIX future at a 0.75 premium to the index at 16.45 a trader came in and bought a Jan VIX 14 / 15 Put Spread. The specific trade was a purchase of 4500 of the VIX Jan 15 Puts at 0.95 and sale of 4500 VIX Jan 14 Puts at 0.46 and a net cost of 0.49. The payoff at expiration for this bear put spread appears below –

VIX po

January VIX settlement at or below 14.00 will result in a gain of 0.51 on this spread. A partial profit may result from settlement between 14.00 and 14.51. Over 14.51 this trade starts to turn into a loser with a maximum loss equal to the 0.49 paid for the spread.