XLI – Industrial Select Sector SPDR Fund – Put strategists populating the XLI, an exchange-traded fund designed to provide investment results that correspond to the price and yield performance of the Industrial Select Sector of the S&P 500 Index, initiated bullish and bearish transactions on the fund today. Shares of the ETF are currently trading 2.00% higher on the day at $29.52 as of 3:05 pm (ET). The first of the two large trades observed on the XLI was enacted by an investor selling-to-close a large-volume long put stance in the June contract. It looks like the trader originally purchased 27,000 puts at the June $28 strike for an average premium of $0.85 apiece back on May 21, 2010, when shares of the XLI were trading at a volume-weighted average price of $29.14. Today the investor appears to have sold 26,900 puts at the June $28 strike for a premium of $0.54 each. The sale of the put options indicates, perhaps, that the trader no longer anticipates a pullback in the fund’s share price to below the $28.00-level in the next several weeks to expiration. In isolation, net losses experienced on the closing sale amount to $0.31 per contract. In contrast to the sale of the puts bearish investors are building up debit put spreads in the July contract. It looks like put-spreaders today are adding to spreads purchased during Tuesday’s session. Investors picked up roughly 10,000 in-the-money puts at the July $30 strike for an average premium of $1.82 each, and sold about the same number of puts at the lower July $26 strike for an average premium of $0.50 apiece. Net premium paid to establish the trade amounts to $1.32 per contract. Thus, investors long the spread are prepared to make money if shares of the fund fall 2.85% from the current price to breach the average breakeven point at $28.68. Maximum potential profits of $2.68 per contract are available should the XLI’s shares decline about 12% to breach $26.00 by July expiration day.