Infosys Sees Heavy Put Option Activity Ahead of December Expiry

Put Option Trading Volume and Open Interest

Data from the derivatives segment reveals that Infosys (INFY) has attracted substantial put option interest, particularly at strike prices close to the current underlying value of ₹1,616.10. The most actively traded put options expiring on 30 December 2025 include the 1,600 strike, which recorded 5,137 contracts traded, generating a turnover of approximately ₹2.15 crores. This strike also holds the highest open interest among the puts, standing at 8,889 contracts, indicating a significant build-up of positions.

Other notable strikes include the 1,620 put, with 3,351 contracts traded and an open interest of 3,452, and the 1,580 put, which saw 2,672 contracts traded with an open interest of 3,099. The combined turnover for these strikes exceeds ₹3 crores, underscoring the scale of put option activity in Infosys ahead of the expiry.

Expiry Patterns and Investor Sentiment

The concentration of put option activity at strike prices slightly below and near the current market price suggests that investors are positioning for potential downside or are seeking protection against adverse price movements. The 30 December expiry date is the nearest monthly expiry, often a period when traders adjust or hedge their portfolios ahead of year-end.

Such elevated put interest can be interpreted as a hedging mechanism by institutional investors or as speculative bets anticipating a correction. This is particularly relevant given Infosys’s recent price behaviour, where the stock has outperformed its sector by 0.4% on the day and has recorded gains over the past two sessions, accumulating a 1.73% return in that period.

Price Performance and Moving Averages

Infosys is currently trading above its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages, indicating a sustained upward momentum in the medium to long term. The stock’s one-day return of 1.07% contrasts with the sector’s 0.29% gain and the Sensex’s decline of 0.21%, highlighting relative strength in the software and consulting space.

Despite this, delivery volumes have shown a decline, with 25.93 lakh shares delivered on 17 December representing an 18.69% reduction compared to the five-day average delivery volume. This drop in investor participation may reflect a cautious approach amid the recent price gains, possibly contributing to the increased demand for put options as a protective measure.

Market Capitalisation and Liquidity Considerations

Infosys holds a large-cap market capitalisation of approximately ₹6,65,612 crore, positioning it as a heavyweight in the Computers - Software & Consulting sector. The stock’s liquidity profile supports sizeable trades, with the average traded value over five days allowing for a trade size of around ₹16.73 crore based on 2% of the average volume. This liquidity facilitates active options trading and enables investors to implement complex hedging or speculative strategies efficiently.

Implications of Put Option Activity

The heavy put option activity at strikes near the current price level suggests that market participants are either hedging existing long positions or speculating on a potential pullback in Infosys shares. The open interest concentration at the 1,600 strike, in particular, points to a key level of interest where traders may expect price support or resistance to emerge.

Such positioning is common ahead of significant expiry dates, as investors seek to manage risk or capitalise on anticipated volatility. The turnover figures, running into crores of rupees, reflect the substantial capital allocation towards these strategies, underscoring the importance of monitoring options market data for insights into investor sentiment.

Contextualising the Put Option Interest

While the put option activity indicates a degree of caution, it is important to note that Infosys has maintained a positive trajectory in recent sessions. The stock’s ability to outperform its sector and trade above key moving averages suggests underlying strength. However, the options market data reveals that investors are preparing for potential volatility or downside risk, a prudent approach given the broader market uncertainties.

Investors and traders should consider these dynamics when analysing Infosys’s near-term outlook. The interplay between price action and options positioning can offer valuable clues about market expectations and risk management strategies employed by participants.

Looking Ahead

As the 30 December expiry approaches, monitoring changes in open interest and trading volumes across various strike prices will be crucial to gauge shifts in sentiment. Any significant unwinding or accumulation of put positions could signal evolving views on Infosys’s price direction.

Given the stock’s large-cap status and sector leadership, developments in its options market often have broader implications for the Computers - Software & Consulting industry segment. Market participants should remain attentive to these signals as they navigate the final weeks of the year.

Summary

Infosys Ltd is currently a hotspot for put option activity, with substantial contracts traded at strikes near the current market price ahead of the December expiry. This activity reflects a mix of hedging and bearish positioning amid a backdrop of recent price gains and sector outperformance. The stock’s liquidity and market capitalisation support active derivatives trading, making it a key focus for investors seeking to understand market sentiment and risk management trends in the software and consulting sector.

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