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Trader makes $1 million bet against soaring chip stock Advanced Micro 

AMD just hit an 11-year high, but one trader is betting it's gone too far too fast
AMD just hit an 11-year high, but one trader is betting it's gone too far too fast

Advanced Micro is on fire.

Shares of the chipmaker have soared more than 130 percent since January, making it the best performing stock in the this year. However, one trader is betting AMD's hot run is about to cool off.

AMD was up nearly 7 percent on Friday morning, extending its gains following a price target increase by Rosenblatt Securities on Thursday. According to "Options Action" trader Mike Khouw the move sparked a flood of options activity in the name.

"AMD is always a very busy stock when it comes to the options market and trades quite a lot," Khouw said Thursday on CNBC's "Fast Money." "We did see double that average options volume [Thursday]." Khouw noted that while many of the options contracts targeted short-term moves to the upside, one trader made a million-dollar bet that AMD has reached a top.

On Thursday, a trader purchased 6,000 of the Feb. 21 puts for $2.26 per contract. Since each options contract counts for 100 shares of stock, this is a more than $1 million bet that shares of AMD will fall below $18.74, or down about 15 percent in the next six months.

Despite AMD's massive run, the stock is still down more than 50 percent from its all-time closing high of $48.50 back in 2000.

Khouw also noted that while the trader's bearish bet could fall through, the broader options market is still implying a double-digit move of 30 percent in either direction between now and February expiration.

Shares of AMD were trading higher on Friday morning, around $23.70.