The dominance of large cap stocks in 2017 continued last week as the Russell 1000 (RUI) lost 0.41% while the Russell 2000 (RUT) was down over 1%.  This widens the performance gap for 2017 to put RUI in a 4.8% lead relative to RUT.

RUT RUI 5122017

The combination of small cap underperformance and VIX remaining at low levels resulted in the CBOE Russell 2000 Volatility Index (RVX) to VIX ratio to climb back to the 50% range. 

RVX VIX 5122017

On Monday one daring soul put on a high dollar risk, low dollar reward trade using RUT Weeklys that expired on Friday.  They specifically sold the RUT May 12th 1370 Puts for 2.61 and then bought the RUT May 12th 1345 Puts for 0.61 resulting in a net credit of 2.00.   It appears RUT was right at 1389.00 when this trade was executed. 

RUT PO 5122017

The payoff diagram shows that although the trader was risking 23.00 points to make 2.00 points, things turned out all right as RUT finished the week over 12 points higher than the short strike put.