Traders made quick profits in Broadcom last week, and now they’re coming back to the well.
optionMONSTER’s Heat Seeker monitoring program detected the purchase of about 10,600 December 44 calls for $0.48 to $0.55. Volume was more than 60 times open interest at the strike, which indicates that new money was put to work.
Long calls lock in the price where investors can buy the semiconductor stock. Because of their relatively cheap cost, the contracts are a much lower-risk means of playing a rally than owning shares. They can also generate significant leverage.
— Option Monster