Quick – someone asks you whether you will bet on Hillary Clinton winning the next election. Would you take that bet? At even odds, you would have to be insane. But what if someone offered you 100-to-1 odds? How about 1000-to-1? At a certain point, it’s worth a punt.

And this is the trouble with discussing option trading. At times, even if you don’t think a specific outcome the most probable result, it still makes sense to take a position based on the market underpricing the probability of that outcome. It’s a nuanced difference but often missed by the financial media.

I am not a big Eurodollar futures trader, but I recognize that it is one of the biggest, most liquid markets in the world. And if you are a STIR (short-term interest rates) trader, then you are most likely aware of the interesting option order flow that has been crossing the tape all summer long. The pits are abuzz with talk, but for the rest of us who aren’t clued into the intricacies of the fixed-income option market, we are probably overlooking this huge bet that is being slapped on.

For me, I rely on Alex Manzara’s blog, Chartpoint, to keep me up to date on the developments in the Eurodollar pit. Alex is an institutional futures broker at RJ O’Brien and an all-around nice guy in that Chicago sort of way.

Alex has recently been highlighting the activity of in the Eurodollar futures option pit where a client (or maybe a group of clients) has been aggressively selling long-dated put ratio option spreads. Got that? Yeah, it’s a mouthful and sometimes deciphering the language of options traders leaves you scratching your head wondering if they are speaking the same language.

But let me walk you through what’s happening and then we can ponder the implications.

This morning, Alex sent me an update on the action in the Eurodollar options futures pit.

This cryptic headline came across my Bloomie:

EDM0 9650-9600 ps 1×6 ppr sell 6 legs over at 7.0 ref 9694. 1k only