Big Bets Against Nvidia and Micron Signal Chip Sector Fear — SkimNews
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- Nvidia saw a $21 million purchase of 100,000 put contracts at the 180-strike expiring Jan. 15, a bet requiring a 22% drop for the position to profit.
- Micron was the focus of $270 million in likely put-buying, centered on deep in-the-money contracts with strikes between 2,250 and 2,500 expiring in June 2028.
- SMH traded over 180,000 puts versus 50,000 calls by midday, with put premium totaling $46 million compared to $26 million in calls, signaling broad semiconductor sector pessimism.
- The put-to-call open interest ratio in SMH reached 1.95, the highest since early August, while the QQQ ratio climbed to 1.51, reflecting rising defensive positioning.
- Traders may be using deep-in-the-money puts in Micron as a substitute for shorting, avoiding high stock-borrow costs while achieving a near-synthetic short position with defined risk.
Why it matters: The scale and structure of these trades suggest institutional investors are hedging or betting against chip stocks amid uncertain momentum, with Micron’s options activity functioning like a $14.5M short position. This shift in positioning could amplify downward pressure if sentiment sours further.
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