There are six Giant Squid hidden throughout the ocean. You can see where they are by looking for seagulls flying in a circle over the water. When you sail your boat in the correct spot, a Giant Squid will appear. To defeat the squid, lock onto the eyes with the boomerang. The following is a list of Giant Squids and their rewards:

Four Eyed Squid: (4,A) Great Fairy: 2x Magic Meter
Eight Eyed Squid: (1,B) 100 Rupees
Eight Eyed Squid: (5,C) 100 Rupees
Eight Eyed Squid: (6,E) 100 Rupees
Twelve Eyed Squid: (3,E) Heart Container
Twelve Eyed Squid: (6,G) Heart Container