Broadcom (NASDAQ: BRCM - option chain) shares are moving higher today after an article in Barron's over the weekend said the stock could rise as much as 40 percent as the chipmaker enters the market for smartphones. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on BRCM.

BRCM opened this morning at $28.23. So far today the stock has hit a low of $27.76 and a high of $28.39. As of 12:20, BRCM is trading at $27.86, up 40 cents(1.5%). The chart for BRCM looks bullish and S&P gives BRCM a positive 4 STARS (out of 5) buy ranking.

For a bullish hedged play on this stock, I would consider a November bull-put credit spread below the $20 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 13.6% return in just three months as long as BRCM is above $20 at November expiration. Broadcom would have to fall by more than 27% before we would start to lose money. Learn more about this type of trade here.

BRCM hasn't been below $20 since April and has shown support around $23 recently.

Brent Archer is an options analyst and writer at Investors Observer.

DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls positions in BRCM.