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Bears targeting Xilinx, semi group

David Russell (david.russell@optionmonster.com)

Semiconductors have been strong, but traders are nervous about the group today--especially Xilinx.

optionMONSTER's Depth Charge monitoring system detected the purchase of about 6,000 October 45 puts in the designer of programmable chips, with premiums  rising from $0.60 to $0.65. Volume was more than 25 times open interest at the strike, indicating the new positions were opened.

Puts lock in the price where shares can be sold, giving them an inverse relationship to the stock. Investors use them to hedge long positions or to speculate on a pullback. (See our Education section)

XLNX is down 1.31 percent to $46.50 in morning trading. It's up 30 percent this year on a string of better-than-expected quarterly reports but is now retreating after touching $48 last week for the first time in more than a decade.

Overall option volume is 5 times greater than average in the name so far today, with puts accounting for more than two-thirds of the total.

The Depth Charge also downside activity today in fellow semiconductor names Marvell Technology, which saw buyers in its Weekly 12 puts that expire this Friday, and Nvidia, which had a bearish put spread in November.

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