A trader placed a massive $129 million bearish put options order on the VanEck Semiconductor ETF (SMH) Monday, representing the single largest options trade in the entire market that day and accounting for over a third of total sector premiums. This contrarian move comes as overall investor sentiment remains decidedly bullish on semiconductors, with the put/call ratio at 1.89, the most lopsided towards calls since April and down from a high of 3.5 in late June. SMH implied volatility collapsed from 65% last month to 40%, the lowest since February, reflecting reduced hedging costs in the sector. The fund peaked in June before entering a 25% draw-down, according to market data analyzed.
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