Options pricing on Nvidia now points to roughly even odds the chipmaker reaches a $6 trillion valuation before November, after the stock's Friday rally pushed it to just under $5.7 trillion. Traders are also pricing a smaller chance of a $7 trillion valuation by late November.
Nvidia added 1.3% Friday, ending seven weeks of sideways trading that surrounded a high-stakes meeting between President Donald Trump and corporate executives leading what Trump calls "super intelligence." The move helped push the Nasdaq-100 Index to a new closing record, as Nvidia notched its first record since May.
Options pricing favors a $6 trillion valuation by month-end
Nvidia accounts for 13% of the Nasdaq and 8% of the S&P 500, so its rally carries outsized weight across both benchmarks. Friday's gain put Jensen Huang's semiconductor business at just under $5.7 trillion.
Based on the price of options trading at Nvidia, the stock will likely cross the $6 trillion threshold this month. Market-maker pricing of deltas on Nvidia options expiring this week and Oct. 30 implies about a 50% chance Nvidia reaches a $6 trillion valuation between now and the end of this month, and a 13% chance it happens this week. The odds it happens between now and Dec. 18 run about 67%.
A smaller bet on $7 trillion by late November
Options pricing also implies about a 1-in-16 chance Nvidia could hit $7 trillion by Nov. 20. Based on the current share count, Nvidia would need to touch $248 to cross that milestone.
According to CNBC: "Nvidia's buyback announcement was a bright spot," Ben Emons, managing director at Highline Asset Management, wrote in a note to clients last week. He added that the buyback is not just a payout but a capital-allocation event that asserts confidence in long-run AI demand.
Some of the stock's call options are currently trading with a higher implied volatility than the equivalent puts, Barchart data shows. Such "call skew" is a sign that traders have a bias toward hedging for a rally, though the same size move in the opposite direction is also just as likely when using deltas to gauge a range of possibilities.
Source: US Top News and Analysis
Trading involves risk.
Risk Disclaimer
