Infosys Sees Heavy Put Option Activity Ahead of December Expiry

Put Option Activity and Market Context

Infosys Ltd (INFY), a leading player in the Computers - Software & Consulting sector, recorded a significant volume of put option contracts expiring on 30 December 2025. Data shows that 2,476 contracts were traded at the ₹1,560 strike price, generating a turnover of approximately ₹27.87 crores. Open interest for these puts stands at 2,288 contracts, indicating sustained interest and potential accumulation of bearish bets or protective hedges.

The underlying stock price at the time of this activity was ₹1,564, placing the ₹1,560 strike price close to the current market level. This proximity suggests that traders are positioning for possible downside or volatility around this price point as the expiry date nears.

Price Performance and Technical Indicators

On the day of analysis, Infosys’s stock price showed a marginal gain of 0.16%, underperforming its sector which posted a 0.36% rise. The broader Sensex index declined by 0.33%, placing Infosys’s performance in a nuanced position relative to market trends. Despite this, the stock is trading above its key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — which often signals underlying strength in the medium to long term.

However, investor participation appears to be waning, with delivery volume on 2 December recorded at 35.32 lakh shares, down by 11.78% compared to the five-day average. This decline in delivery volume may reflect reduced conviction among buyers or a cautious stance ahead of the expiry.

Liquidity and Market Capitalisation

Infosys maintains a large-cap status with a market capitalisation of ₹6,48,433 crore, underscoring its prominence in the Indian equity market. The stock’s liquidity supports trade sizes up to ₹20.61 crore based on 2% of the five-day average traded value, facilitating sizeable institutional and retail transactions without significant price impact.

Implications of Put Option Concentration

The concentration of put options at the ₹1,560 strike price with a sizeable open interest suggests that market participants are either hedging existing long positions or speculating on a potential price correction. Put options serve as a form of insurance against downside risk, and their popularity often rises when investors anticipate increased volatility or a bearish shift.

Given that Infosys is trading above all major moving averages, the put activity may also reflect a cautious approach rather than outright bearishness. Investors might be seeking protection against short-term fluctuations while maintaining a longer-term positive outlook.

Expiry Patterns and Investor Behaviour

The 30 December 2025 expiry is a key date for options traders, as it marks the end of the current quarterly cycle. The build-up of open interest in puts ahead of this expiry can lead to increased volatility as traders adjust or close positions. The strike price near the current market level often becomes a focal point for price action, with potential for sharp moves if the stock breaches this level.

Infosys’s recent trading volumes and delivery statistics indicate a slight reduction in investor participation, which may contribute to price sensitivity around expiry. Market participants will be closely monitoring the stock’s movement in the coming weeks to gauge whether the put option interest translates into actual price pressure.

Sector and Market Comparison

Within the Computers - Software & Consulting sector, Infosys remains a heavyweight with a dominant market cap and liquidity profile. Its performance relative to the sector and Sensex on the day of analysis shows a nuanced picture, with the stock slightly lagging sector gains but outperforming the broader market index.

This mixed performance, combined with the active put option interest, suggests that investors are weighing sectoral growth prospects against potential headwinds such as global economic uncertainties or technology spending cycles.

Outlook and Investor Considerations

Investors analysing Infosys should consider the implications of the concentrated put option activity alongside the stock’s technical positioning and sector dynamics. The proximity of the ₹1,560 strike price to the current market value highlights a critical support level that may influence near-term price movements.

While the stock’s trading above key moving averages suggests underlying strength, the reduced delivery volumes and active put interest point to a degree of caution among market participants. This combination may result in heightened volatility as the December expiry approaches.

Market participants may also want to monitor broader sector trends and global technology spending patterns, which could impact Infosys’s performance in the coming months. The stock’s large-cap status and liquidity profile make it a key bellwether for the Computers - Software & Consulting sector.

Conclusion

Infosys’s position as the most active stock in put options trading ahead of the 30 December 2025 expiry underscores a complex market sentiment balancing cautious hedging with underlying technical strength. The significant open interest at the ₹1,560 strike price and the stock’s mixed price performance suggest that investors are preparing for potential near-term volatility while assessing longer-term prospects.

As expiry approaches, the interplay between option positioning, delivery volumes, and sector trends will be critical in shaping Infosys’s price trajectory. Investors should remain attentive to these factors to navigate the evolving market landscape effectively.

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