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Options traders place big bets on AMD ahead of Xilinx acquisition

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Options traders place big bets on AMD ahead of Xilinx acquisition

AMD and Xilinx will be meeting Wednesday to converse in regards to the crucial components of AMD’s proposed $35 billion acquisition of Xilinx, which is planned to nearby the halt of the 12 months.

The big consume, which has been within the works since October, is designed to serve get out AMD’s information center capabilities within the years ahead. Options traders are having a wager that this meeting could maybe maybe additionally get the firms one step nearer to their merger.

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Bullish options process within the chip situation is nothing fresh in present weeks. The SMH semiconductor ETF has won 10% in precisely the closing month as provide shortages force costs increased. In Monday’s session, even supposing, loads of process became stock-particular, and AMD became a big winner.

“We seen calls outpace places by [a ratio of] about 3-to-1 in AMD nowadays, and essentially the most consuming options were the 82-strike calls that expire on the halt of this week,” Optimize Advisors CIO Michael Khouw said Tuesday on CNBC’s “Quick Money.” “Over 18,000 of those traded for approximately $1, and that approach that the name investors were risking about 1.2% [of the underlying stock price] to get bullish bets that the stock could maybe maybe additionally rush above that $82 strike by the halt of the week.”

These calls ruin even at $83, or moral about 2% increased than the place AMD closed Tuesday’s session. That is by no approach an uncommon target for the stock to hit by Friday’s end and sure reflects the outcomes of any decided consequence from Wednesday’s meeting.

AMD became trading a bit of increased in Wednesday’s session.

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Options traders place big bets on AMD ahead of Xilinx acquisition

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