MRVL – Marvell Technology Group Ltd. – Global semiconductor maker, Marvell Technology Group Ltd., popped up on our ‘most active by options volume’ market scanner in the second half of the trading session due to rampant bearish options activity in the July and August contracts. Marvell’s shares edged 1.50% lower this afternoon to stand at $17.11 just ahead of the closing bell. Pessimistic traders expecting shares to continue lower ahead of July expiration sold 3,100 calls at the July $17 strike for an average premium of $0.74 each. Call selling spread to the August $15 strike where 2,300 in-the-money calls were sold at an average premium of $2.52 per contract. Perhaps in-the-money call sellers are hoping to keep the full premium received on the sale, which is possible only if Marvell’s shares decline another 12.33% to slip beneath $15.00 ahead of August expiration. Investors sold another 3,800 in-the-money calls at the August $16 strike for an average premium of $1.82 each. Finally, 3,000 in-the-money calls were shed at the higher August $17 strike for an average premium of $1.22 apiece, and some 3,200 calls were sold at the August $18 strike for an average premium of $0.77 a-pop. Bearish traders selling call options on the semiconductor maker benefit if Marvell’s shares continue to decline through July and August expiration.
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Andrew Wilkinson is the senior market analyst at Interactive Brokers Group, where he provides daily commentary and analysis on U.S. equity options trading throughout the trading day. Andrew provides webinars designed to explain option-related trading scenarios covering futures, fixed income, forex and equities.
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