Chip rebound triggers hedging activity among traders
Semiconductor stocks: traders hedge chip gains as options bets spike See why puts surged in SOXX while bullish call buying hit Marvell and Intel
Traders moved quickly to hedge semiconductor exposure on Monday after a strong rebound in chip stocks, according to CNBC's Options Action.
Put trading in the VanEck Semiconductor ETF outpaced calls by more than two to one, and more than half of the premium traded was tied to puts. The activity suggested skepticism that the sector’s sharp rally would hold after a recent runup.
At the same time, some traders placed bullish bets on individual names. Marvell Technology saw heavy call buying after S&P Dow Jones Indices said the company will join the S&P 500 later this month. Intel also drew increased call activity after reports that Alphabet had commissioned the company to help make AI chips, while Cerebras saw strong demand for call options as well.