Exchange-traded funds feel the pinch from bearish investors

United States options traders have never been so bearish on Chinese mainland's shares amid concern that expensive valuations will offset government efforts to revive investor confidence after a $4 trillion rout.

Puts protecting against a 10 percent decline in the Deutsche X-trackers Harvest CSI 300 China A-shares fund cost 1.8 times the price of calls betting on a 10 percent increase, according to three-month data compiled by Bloomberg.

The cost of the bearish options has surged as much as 75 percent in the past three weeks. The ETF, with about $600 million in assets, has declined 21 percent from a June 12 peak, mirroring a selloff in the benchmark Shanghai Composite Index.