Infosys Sees Heavy Put Option Activity Ahead of December Expiry

Put Option Activity Highlights

On 27 November 2025, Infosys (INFY) recorded a total of 2,079 put option contracts traded at the 1560 strike price, generating a turnover of approximately ₹27.57 crores. The open interest for these contracts stands at 1,859, indicating a substantial volume of outstanding positions yet to be exercised or closed. The underlying stock price at the time was ₹1,566.60, placing the strike price slightly below the current market value, which may suggest protective hedging or speculative bearish bets.

Expiry Patterns and Market Implications

The December 2025 expiry date is a critical juncture for options traders, often prompting increased activity as market participants adjust their portfolios. The concentration of put options at the 1560 strike price for Infosys suggests that investors are either seeking downside protection or anticipating potential price corrections in the near term. This activity is particularly noteworthy given Infosys’s status as a large-cap stock with a market capitalisation of ₹6,48,994 crores, making it a key bellwether in the Computers - Software & Consulting sector.

Stock Performance Context

Infosys has outperformed its sector by 0.35% on the day, with a one-day return of 0.59% compared to the sector’s 0.20% and the Sensex’s 0.31%. The stock has recorded gains over the last two consecutive days, delivering a cumulative return of 2.41% during this period. Furthermore, Infosys is trading above its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages, indicating a generally positive technical trend despite the heightened put option activity.

Investor Participation and Liquidity

Delivery volume on 26 November was 46.28 lakh shares, which represents a decline of 30.44% compared to the five-day average delivery volume. This reduction in investor participation may reflect a cautious stance amid the mixed signals from price performance and options market activity. Nevertheless, the stock remains sufficiently liquid, with a trading capacity of approximately ₹33.45 crores based on 2% of the five-day average traded value, supporting sizeable trade executions without significant market impact.

Bearish Positioning and Hedging Strategies

The prominence of put options at a strike price just below the current market value suggests that market participants may be seeking downside protection amid uncertainties. Put options serve as insurance against price declines, allowing holders to sell shares at the strike price even if the market price falls below it. This is a common strategy for investors looking to hedge existing long positions or to speculate on potential price drops.

Given Infosys’s recent upward momentum and its trading above multiple moving averages, the put option activity could also reflect a cautious approach by investors anticipating a possible pullback or increased volatility in the coming weeks. The open interest figure of 1,859 contracts further underscores the sustained interest in these protective positions, which may influence price dynamics as expiry approaches.

Sector and Market Comparison

Within the Computers - Software & Consulting sector, Infosys remains a dominant player, and its option market activity often serves as a proxy for broader investor sentiment in the technology space. The stock’s outperformance relative to its sector and the Sensex on the day highlights its resilience, yet the active put option trading indicates that some investors are preparing for potential headwinds.

Such mixed signals are not uncommon in large-cap stocks where institutional investors employ complex strategies to manage risk and capitalise on market movements. The interplay between spot price trends and derivatives market activity provides valuable insights into market psychology and potential future price action.

Outlook and Investor Considerations

As the 30 December 2025 expiry approaches, monitoring the evolution of put option open interest and strike price concentrations will be crucial for investors tracking Infosys. The current activity suggests a degree of caution or hedging, which may translate into increased volatility or price consolidation in the near term.

Investors should weigh the technical indicators, such as the stock’s position relative to moving averages and recent price gains, against the derivatives market signals. This balanced approach can help in understanding the underlying market sentiment and in making informed decisions regarding exposure to Infosys shares.

Overall, the active put option trading in Infosys highlights the nuanced strategies employed by market participants in managing risk and positioning ahead of key expiry dates within the large-cap technology segment.

Get 1 year of Weekly Picks FREE when you subscribe to MojoOne. Offer ends soon. Start Saving Now →