AMD Shares Climb to New All-Time High, Bolstering Call Options Demand
$Advanced Micro Devices(AMD)$
AMD shares jumped as much as 7.8% to $253.39, before ending the trading day at $252.92, also a closing record high. The rally bolstered the odds that out-of-the-money call options could be in the money before the contract expires in seven days.
An active buyer paid a $1.12 million premium for call options that give their holder the right to buy 265,000 at $260 in seven days. That block trade boosted the contract's volume to more than 24,920 call options, surpassing the open interest, or the tally of outstanding contracts of 9,420, exchange data showed.
IBM's work showed that the company can make progress in its quantum computing initiatives on old AMD chips that are not "ridiculously expensive," Reuters reported, citing an interview with IBM research director Jay Gambetta. That could signal that the depreciation of the AMD semiconductors could be slower than many on Wall Street feared, likely boosting demand.
About 1.66 million call and put options tied to the chipmaker changed hands, landing AMD in sixth place for Friday's most active stock option, behind $Tesla (TSLA.US)$'s 3.97 million contracts, $NVIDIA (NVDA.US)$'s 3.01 million, $Beyond Meat (BYND.US)$'s 2 million, $Wolfspeed (WOLF.US)$'s 1.98 million and $Intel (INTC.US)$'s 1.73 million.
IBM CEO Arvind Krishna cited the partnership with AMD in his company's earnings call on Wednesday, noting how it's "leveraging IBM's quantum expertise and AMD's CPUs, GPUs and other accelerator technologies."
When the partnership was first announced in August, the companies said in a press release that "AMD and IBM are exploring how to integrate AMD CPUs, GPUs, and FPGAs with IBM quantum computers to efficiently accelerate a new class of emerging algorithms, which are outside the current reach of either paradigm working independently."
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