Mike Khouw Sees Unusual Options Activity In NXP Semiconductors

On CNBC's "Options Action," Mike Khouw spoke about unusually high options activity in NXP Semiconductors NV NXPI on Tuesday.

Its put options volume was three times the average daily put volume and one of the largest trades of the day was in the October $210/$220 collars. Somebody bought 350 contracts of the October $210 puts and sold 350 contracts of the October $220 calls. The total cost for the trade was $3.90. The trade could be a hedge for a long position and it offers protection below $206.10 or 4.2% below the closing price on Tuesday.