Broadcom Corporation (BRCM) M&A Hopes Spark Options Frenzy

Broadcom Corporation (BRCM) options are in demand amid buyout hopes

May 27, 2015 at 2:46 PM
facebook X logo linkedin


While a handful of semiconductor stocks are comfortably higher this afternoon, Broadcom Corporation (NASDAQ:BRCM) has left its sector peers in the dust. The security just catapulted to a 14-year high of $56.40 -- and was last seen 16.7% higher at $54.78 -- amid reports that Avago Technologies Ltd (NASDAQ:AVGO) is in talks to buy the firm. Against this backdrop, BRCM calls are flying off the shelves at a rapid-fire rate. 

Specifically, BRCM has seen roughly 51,000 calls cross the tape -- more than five times the intraday norm, and about five times the number of puts exchanged. It looks like bulls are buying to open 55-strike calls in both the weekly 5/29, June, and July series, gambling on an extended climb north of $55 in the near term. What's more, the equity's 30-day at-the-money implied volatility has more than doubled to 54.6% -- an annual high. 

Even before today's M&A surge -- which echoes that of Juniper Networks, Inc. (NYSE:JNPR) -- Broadcom Corporation (NASDAQ:BRCM) option traders were betting bullishly. On the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity's 10-day call/put volume ratio of 8.41 stands higher than 86% of all other readings from the past year.

 

Unlock Weekend Profits with Chris Prybal's Favorite Strategy Up +487.5% in 2024

With the markets going left, right, and sideways, you need to have a plan now more than ever. 

Expert Trader Chris Prybal is no stranger to volatility, and has mastered finding big stock rallies while other traders aren't looking over the weekend. Rallies that produced gains like +207% on RTX calls, +236% on MARA calls, and +238% on NET calls.

A few simple moves on Sunday at 7pm could be the “Secret Sauce” your portfolio needs to not just stay afloat, but make unprecedented gains in this turbulent market.


Don’t sit on the sidelines, beat the market with Chris Prybal's strategy. Join him now!