Option Focus | Micron Sees $25 Million Block Trade in $700 Call; Traders Hedge With 30,000 Near-Dated OTM Puts

MU shares closed at $751.00 on Monday, down 1.46%, as unusual activity in the company’s options market pointed to diverging views on the chipmaker’s near- and medium-term outlook.

Over recent sessions, traders have simultaneously accumulated large positions in longer-dated deep-in-the-money call options and near-dated deep out-of-the-money put options, with combined premium exceeding $25 million. The positioning suggests investors remain constructive on Micron’s medium-term trajectory while seeking protection against potential short-term downside risks.

Elevated Volatility Signals Expensive Option Pricing

Micron’s options market continues to reflect elevated volatility expectations. As of May 25, 2026, the stock’s implied volatility stood at 95.18%, while its IV percentile reached 96.41%, indicating current volatility levels are higher than roughly 96% of readings over the past year.

Under commonly used options frameworks, an IV percentile above 70% is generally viewed as elevated, suggesting option premiums have become relatively expensive.

Meanwhile, the stock’s call-to-put volume ratio stood at 1.09, pointing to a mildly bullish overall bias, although positioning remained broadly balanced between upside speculation and downside hedging.

Large Trades Show “Offense and Defense” Positioning

Block trades over the past three trading days reflected a market structure combining bullish directional bets with defensive hedging activity.

Notably, there was little evidence of investors aggressively selling far out-of-the-money options to collect premium. Instead, activity was concentrated on the buy side.

On one hand, traders amassed sizeable positions in longer-dated in-the-money call options, signaling expectations for continued upside momentum over the medium term. On the other, heavy buying emerged in near-dated deep out-of-the-money puts, a pattern more consistent with tail-risk hedging than outright bearish speculation.

$25 Million Spent on June 2026 $700 Calls

The most prominent trade involved purchases of Micron's June 18, 2026 $700 call options.

Combined volume reached 2,509 contracts, with total premium paid amounting to approximately $25.09 million. The position represents an aggressive bullish wager, with buyers willing to pay substantial premiums to maintain leveraged upside exposure should Micron shares remain resilient or continue climbing.

$MU 20260618 700.0 CALL$

Source: Tiger Trade App

Traders Buy Cheap Tail-Risk Protection

At the same time, the market saw three sizeable purchases of puts expiring May 29, 2026, with strike prices at $460, $420 and $390.

$MU 20260529 460.0 PUT$

Source: Tiger Trade App

Aggregate volume across the three trades totaled 28,710 contracts, although total premium paid was only about $478,000 due to the contracts’ extremely low prices, ranging from $0.10 to $0.25 per option.

The “high volume, low premium” profile is characteristic of low-cost tail-risk hedging strategies designed to protect against sudden market shocks or sharp short-term declines.

Strategy Takeaways

The overall structure suggests investors are positioning for continued medium-term upside while maintaining near-term downside insurance.

The longer-dated in-the-money call buying reflects a clear bullish directional stance, potentially combined with expectations for sustained elevated volatility. Meanwhile, the accumulation of deep out-of-the-money puts appears aimed at protecting existing positions or anticipated gains against abrupt downside events.

In broader terms, the market positioning can be summarized as “defensive in the short term, constructive over the medium term.”

Given implied volatility remains near historical highs, outright selling of deep out-of-the-money options solely to harvest premium may offer an unfavorable risk-reward profile. Investors seeking to limit margin exposure may instead consider defined-risk strategies such as bull call spreads or covered calls to participate in potential upside while managing costs and volatility exposure.