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.

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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.