Signal Says Avoid This Chip Stock in October

AMD has been lagging the SMH over the last three months

Deputy Editor
Oct 5, 2023 at 10:18 AM
facebook X logo linkedin


Increased interest in artificial intelligence (AI) has boosted chip stocks so far this year, with the VanEck Semiconductor ETF (SMH) up 43.1% in 2023. Sector stalwart Advanced Micro Devices Inc (NASDAQ:AMD) is outperforming the SMH, up 60.7% year to date. However, over the last three months, AMD has shed 24% off its June 13 2023 peak of $132.83, and at last glance, is down 2.2% at $101.77 today. To make matters worse,  stock is entering a historically bearish month.

Schaeffer's Senior Quantitative Analyst Rocky White just released his list of the worst S&P 500 Index (SPX) stocks to own in October. AMD is the only semiconductor stock to land on the list, averaging a loss of 3.7% in October and ending the month lower 60% of the time.

Options traders looking to speculate on AMD's short-term trajectory should consider options. The equity's Schaeffer's Volatility Index (SVI) of 49% is higher than just 13% of all other readings from the past year, suggesting near-term option contracts are attractively priced at the moment, from a historical volatility standpoint.

What's more, the security's Schaeffer's Volatility Scorecard (SVS), which sits at an elevated 76 out of 100, suggesting it exceeded option traders' volatility expectations during the past year. 

 
 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI