Higher volatility seen for ARM Holdings
Chris McKhann | firstname.lastname@example.org
optionMONSTER systems show that volume of 4,500 contracts is already triple its full-session average. A trader bought 3,750 April 38 puts for the ask price of $0.65 in volume that was 10 times the previous open interest, so this is a clearly a new position.
A minute earlier, the biggest block of ARMH stock traded as 100,000 shares were bought for $40.10. The combination of stock and options creates an overall position that is delta-neutral and long volatility, meaning that the trader is anticipating a big move up or down in the stock. (See our Education section)
ARMH is down 2.86 percent to $40.02 this morning. That is the U.K.-based chip maker's lowest level since the middle of January and represents support. Shares were hit a 52-week high above $40 at the start of the month.