Xilinx draws bearish play before earnings
Mike Yamamoto | firstname.lastname@example.org
More than 2,300 July 30 puts have traded in a strong buying pattern for $0.35 to $0.40, according to optionMONSTER's Depth Charge system. Open interest in the strike at the start of the session was just 594 contracts, indicating that these are new positions.
Barely half an hour into the trading day, overall option volume in the name is already more than twice its daily average. Puts outnumber calls by 9 to 1, a reflection of the session's bearish sentiment so far.
XLNX is up 0.35 percent to $31.31 in morning trading. The stock began the month at $33.75 but has fallen sharply since then and is now at support levels that go back to last December.
The put buying could be a straight bearish bet or a hedge on a long position in XLNX, though our systems did not detect stock activity linked to the options today. Either way, the position would profit if the shares are down roughly 5 percent or more in the next week until expiration. (See our Education section)
The company, which makes programmable-logic chips, is scheduled to report earnings results on Wednesday after the bell.