Source: Bloomberg

Volatility on the Korea ETF (ticker EWY) spiked from around 16% to 24% during the past couple of weeks, partly because vol jumped in all equity markets and partly because of strategic concerns.

Investors can sell an out-of-the-money call EWY at $62 (vs. today’s price of $60.37) and pocket about $4.60, or 7.6% of the value of the stock. If the stock rises and is called away, the investor earns about 10% in option premium plus appreciation. If the stock falls, the investor has a nearly 8% buffer before losing money.