Semiconductor sector drops 7% as traders rush into inverse ETF options for a bearish bet.

After hitting record highs, the semiconductor sector dropped nearly 7%, prompting traders to buy options in Direxion's triple-levered inverse semiconductor ETF (SOXS) as a cheaper way to bet on a sector downturn. Options volume in SOXS surged to over three times the monthly average, with call options outnumbering puts by more than six-to-one, indicating strong bullish bets on the ETF, which profits from semiconductor stock declines. This trend reflects growing interest in leveraged ETFs amid volatile chip stocks, with traders using complex strategies like selling in-the-money puts to gain synthetic long positions at lower costs. The activity highlights market expectations of a potential semiconductor sector pivot after a strong rally.