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Q3 and Q4 are historically stronger for Intel than Q1 and Q2. They have hit full stride on Sandybridge so their costs are probably low. There is a lot of OCT PUT option activity again today. Todays volumes for OCT PUT are around 80,000 contracts at strikes of $20 thru $24. 80k contracts covers 8mil shares. The buying and selling of 80,000 OCT put options will throttle the trading range. There are also blocks of 5,000 or greater sprinkled throughout the calendar, Dec, Jan12, ....It looks like pre-earnings insurance.
Yes, tons of puts today!What's happening??
Any company that has issued disappointing earnings has taken a hard hit. IMO, I think that people are BUYING the high strike puts for downside protection and then SELLING the lower strike puts to offset the cost of buying the protection. Buying the high strike put options is their "insurance" against bad earnings OR weak forecast. The lower strike put options are expected to expire worthless.Next Wednesday after earnings, they will sell to close the high strike PUTs on good earnings or buy to close the low strike on bad earnings.