CNBC reported that a trader opened a 52,000-contract Nvidia spread with a $57 million long-call leg Monday, as SpotGamma data showed options activity leaning toward calls.
The position paired 52,000 $195 calls expiring Feb. 19, valued at about $57 million, with the sale of 52,000 calls at a $245 strike. CNBC said the short-call leg lowered the trade’s cost by $10 million and the options premiums involved topped $100 million.
CNBC put the spread’s approximate break-even at $206 per share at expiration. The $245 calls are near Nvidia’s $243 record share price, which the outlet said the stock reached Oct. 6.
SpotGamma analysis suggested the new position was likely a roll-down from a closed $210/$255 call spread valued at about $42 million. SpotGamma founder Brent Kochuba told CNBC that moving to lower strikes increased the trader’s upside exposure. He said the trader used a spread because options volatility was expensive ahead of earnings.
SpotGamma data showed calls accounted for 57% of Nvidia options volume by midday, with buyers likely initiating more than $660 million in call premium. Nvidia appeared in 12 of the 20 largest options trades by dollar value.
