Broadcom Inc. closed at $339.27, down 1.58%.

Large options trades on AVGO displayed a decisively bearish institutional tone. The most prominent flow was a $2.59 million in-the-money bear put spread, accompanied by a $1.58 million long-dated out-of-the-money put purchase. Both structures involved paying premium for downside exposure, with no meaningful bullish large-trade participation, indicating that institutional sentiment is skewed toward further weakness rather than upside accumulation.

>>>Start OPTIONS trading & earn up to SGD 200 in rewards!

Options Indicators

AVGO’s implied volatility is 38.36%, and with an IV percentile of just 1.20%, current option volatility sits near the very low end of its historical range. Combined with an IV/HV ratio of 1.07, this suggests implied volatility is only slightly above realized volatility, while overall option pricing remains relatively cheap rather than stretched.

The Call/Put volume ratio is 1.51.

Large Trades

A bearish put spread with a net debit of $2.59 million stood out as the largest displayed combination trade, involving the purchase of 1,200 September 18, 2026 $420.00 puts and the sale of 1,007 September 18, 2026 $410.00 puts. With AVGO referenced at $339.27, both strikes are in the money, and this structure clearly expresses a downside view while capping maximum profit below the long-put strike. As a bear put spread entered for a net debit, the trader was paying premium for bearish exposure rather than collecting income, which suggests a directional downside bet with defined risk and a targeted payoff profile into the 2026 expiration.

A $1.58 million single-leg put buy was the other displayed large trade, consisting of 1,500 March 19, 2027 $270.00 puts purchased outright. This strike sits out of the money versus the $339.27 reference price, making it a lower-strike bearish position that likely seeks protection against a larger future decline or levered downside participation over a longer time horizon. As an outright put purchase, it reflects clean bearish intent through premium paid, with the trader accepting time decay in exchange for convex downside exposure.

Overall, the large-trade flow points clearly bearish. The displayed trades were both downside structures, with one using an in-the-money bear put spread to express a defined-risk bearish view and the other using longer-dated out-of-the-money puts to position for further weakness over time. The broader block-order picture reinforces that tone, as the directional premium was concentrated on bearish trades with no meaningful bullish large-trade participation, indicating institutional sentiment is skewed toward downside risk rather than upside accumulation.

Strategy Reference

For traders looking to fade the bearish flow without posting large margin, a bull put spread using a strike near $270.00 or below for the short leg could offer a lower assignment probability, while a defined-risk bear put spread similar to the displayed $420.00/$410.00 structure may suit those expecting continued downside into 2026 but wanting to cap margin requirements.