Schaeffer's Trading Floor Blog

TriQuint Semiconductor Lures Call Buyers Amid iPhone-Related Rally

Bulls bought a batch of calls on TQNT on reports the company supplied parts for Apple's iPhone

by 10/14/2011 10:05 AM
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Call volume ramped up on TriQuint Semiconductor (TQNT - 7.37) yesterday, with roughly 22,000 contracts crossing the tape -- representing about 27 times the stock's typical daily call activity. Meanwhile, only 4,136 put contracts were exchanged on TQNT.

TQNT price chartThe day's most active strike was the October 7 call, where 3,912 contracts traded. About 71% of these near-the-money calls crossed closer to the ask price, suggesting they were purchased, and open interest at this strike rose overnight by 2,473 contracts. In other words, it seems safe to assume that new bullish bets were added at the October 7 call on Thursday.

Data from the major options exchanges confirms a healthy appetite for TQNT calls. During the course of Thursday's session, speculators on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) bought to open 6,549 calls on the equity, compared to 555 puts -- netting TQNT a single-day call/put volume ratio of 11.80.

This uptick in call activity was likely due to an iPhone-related boost, as iFixit revealed yesterday that TQNT supplied parts for the latest iteration of Apple's (AAPL) wildly popular smartphone. After rallying 24.6% on Thursday, TQNT is wobbling around breakeven today. Nevertheless, the stock is on track for a Friday finish above its 10-week moving average for the first time since May.

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