Options Traders Target Chip Stock Amid Rally

The stock is pulling back from its Friday peak

Deputy Editor
Mar 20, 2023 at 2:58 PM
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Advanced Micro Devices Inc (NASDAQ:AMD) is down 2.4% at $95.51 at last glance, despite a price-target hike from Raymond James to $115 from $100. The firm resumed coverage with a "strong buy" earlier this month. 

Today's pullback has AMD falling from Friday's seven-month highs. The stock is still above its 320-day moving average, however, after last week breaking above it for the first time since June. Year-to-date, the equity is up 47.5%. 

AMD March20

The semiconductor name has attracted the attention of options traders over the past couple weeks. According to Schaeffer's Senior Quantitative Analyst Rocky White's list of stocks that have attracted the highest weekly options in the past 10 days, AMD saw 3,099,477 calls and 2,597,830 puts exchanged in that time. The most popular contract over this period was the March 90 call. 

MAO March20

Now could be a good time to weigh in on the security's next move with options. The stock is seeing attractively priced premiums at the moment, per AMD's Schaeffer's Volatility Index (SVI) of 51%, which sits in the 20th percentile of its annual range. Furthermore, the security's Schaeffer's Volatility Scorecard (SVS) sits at a 93 out of 100, meaning it has exceeded option traders' volatility expectations during the past year.

 

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