OptionsHouse

Options Trading News

September 20, 2016  Tue 12:12 PM CT

TSM : SEE CHART GET CHAIN FIND STRATEGIES

Traders are positioning for a possible drop in Taiwan Semiconductor.

optionMONSTER's monitoring program shows that more than 4,100 October 30 puts were purchased mostly for $0.90 today. Volume was more than 35 times the strike's open interest, indicating that new positions were established.

Long puts lock in the price where a stock can be sold, so they make money if shares decline. Investors use them to hedge long positions or to speculate on a drop. (See our Education section)

TSM is up 0.03 percent to $29.94 in afternoon trading and has rallied 14 percent in the last three months. The chip maker is expected to report earnings in pre-market hours on Oct. 13.

Overall option volume in the name is 7 times greater than average so far today. Puts outnumber calls by a bearish 51-to-1 ratio.

Share this article with your friends


OptionsHouse

Premium Services

Education & Strategy

Continue to melt up? Think debit call spreads

The U.S. equities market is continuing to melt up. Even though the labor market is stagnant, the Fed keeps hinting that a short term interest rate hike is coming sometime soon.

View more education articles »