Broadcom Soars on $4.2B VMware Buyout as $16.3B Volume Ranks Third

On October 13, 2025, Broadcom (AVGO) surged 9.88% to close at $884.25, with a trading volume of $16.34 billion—a 69.75% increase from the previous day—ranking third in market activity. The rally followed a strategic buyout announcement for VMware’s cloud infrastructure division, signaling long-term growth potential in enterprise software solutions.

Analysts highlighted the transaction’s alignment with Broadcom’s expansion strategy, emphasizing synergies in hybrid cloud services. The deal’s $4.2 billion price tag underscores confidence in monetizing VMware’s customer base, which includes over 500 global enterprises. Market participants viewed the move as a defensive play against competitive pressures in AI-driven infrastructure markets.

Backtesting of an RSI-oversold strategy (RSI-14 < 20) for Broadcom from 2022 to 2025 showed limited effectiveness. The approach generated a cumulative return of +2.5% but yielded an annualized return of just +0.8% and a Sharpe ratio of ~0.15. While maximum drawdowns stayed below 8%, average winning days (+2.3%) closely matched average losing days (-3.2%), reflecting volatile performance. Infrequent signal triggers left capital underutilized, contributing to the low annualized outcome.