A major earnings beat for Advanced Micro Devices (AMD) sent semiconductor stocks and exchange traded funds rallying Thursday, but some traders used the opportunity to put on some defensive positioning with one well-known chip fund.

The VanEck Vectors Semiconductor ETF (NYSEArca: SMH), another widely followed semiconductor exchange traded fund, has also endured some recent weakness, but the fund jumped more than 1% Thursday following AMD’s earnings report.

“Around 97,000 calls and 26,000 puts have changed hands on SMH so far — nearly three times what’s typically seen, and volume pacing in the 98th annual percentile. The bulk of the activity has centered at the September 90 and 100 puts, where matching blocks of 19,100 contracts changed hands around the same time earlier,” according to Schaeffer’s Investment Research.

More Tests for Semiconductors

SMH tracks the MVIS US Listed Semiconductor 25 Index. The ETF holds 26 stocks, including Intel Corp. (NASDAQ: INTC), Micron Technology (NASDAQ: MU) and NVIDIA Corp. (NASDAQ: NVDA). Some of those companies and several other big-name semiconductor stocks report earnings in the coming weeks, potentially providing opportunities or tests for SMH and rival chip ETFs.

“This bearish positioning by options traders just echoes a growing trend. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the exchange-traded fund’s (ETF) 10-day put/call volume ratio of 6.37 ranks in the 78th annual percentile, meaning puts have been bought to open over calls at a quicker-than-usual clip,” according to Schaeffer’s.

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