Remarkable $7 Million Turning from $600k: The Intel Trading Phenomenon
Methodology of the Trade
As Intel (NASDAQ: INTC) released its Q2 earnings on August 1, options traders were positioned for a weaker-than-expected outcome. This strategic foresight paid off when Intel's stock price plunged significantly following the earnings report, allowing one trader to earn millions.
The Trader's Strategy
The trader made a calculated move by purchasing $27.5 put options set to expire on the same day, anticipating a decline in Intel’s share value.
- The trader exited the position on August 2, securing a remarkable return of 1,029% in under 24 hours.
- This transformed an initial investment of $622,000 into over $7,712,800.
Broader Market Trends
The trader's success was part of a larger trend, as many investors adopted bearish positions against Intel around the same time. Influencing factors included:
- A weaker-than-anticipated Q2 report.
- Intel’s impending workforce reduction.
- Lower salary offers compared to rivals in the AI sector.
Despite initial gains, Intel's stock has faced ongoing challenges. After posting disappointing earnings, INTC stock is down 32.15% since the report, reflecting broader market pressures.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.