Why AMD Presents an Intriguing Play for Options Bulls

Advanced Micro Devices stock has plenty of room to run

Nov 11, 2020 at 12:13 PM
facebook X logo linkedin

Semiconductor stalwart Advanced Micro Devices, Inc. (NASDAQ:AMD) is bouncing off its 100-day moving average, which previously served as a springboard to a huge rally back in July. With additional support emerging at the $100 billion market cap level, there is reason to believe AMD has room to run on the charts.

AMD Nov 11

Short interest has fallen off a cliff, down 80% in the last 12 months. Continued short covering could serve as a tailwind for the equity. There also looks to be massive upgrade potential toward the chip stock. This is per the 11 of 25 covering analysts sporting a tepid "hold" or worse recommendation. Plus, the consensus 12-month price target of $87.57 is a slim 2.7% premium from its current perch.

Options are certainly the route, with premium affordably priced in a post-earnings volatility crush. The stock's Schaeffer's Volatility Index (SVI) of 46%, which sits higher than just 11% of all other annual readings. Plus, AMD's Schaeffer's Volatility Scorecard (SVS) ranks at 76 out of 100, meaning the security has tended to exceed these expectations during the past year -- a boon for premium buyers.

Subscribers to Schaeffer's Weekend Trader options recommendation service received this AMD commentary on Sunday night, along with a detailed options trade recommendation -- including complete entry and exit parameters. Learn more about why Weekend Trader is one of our most popular options trading services.



How to collect 1 dividend check every day for LIFE

Did you know you could collect 1 dividend check every day the market is open? You could also do it starting with just $605! For me, I'm collecting 70 dividend checks every quarter…which averages around 1.1 dividend checks every business day. There's no trading behind this... no penny stocks or high-risk investments. All you do is buy and hold and you're set. There's no set up required either. If you start buying the dividend stocks I show you today... you could collect 1 dividend per day starting as early as this week. Click here for all the details.