Since the start of the year, I have been placing hedges against my Nvidia bearish positions because Nvidia’s continual rise in share price meant that my unrealised losses were increasing and I was starting to face liquidity issues because of that. Coupled with my falling short of 200 Nvidia shares in my 3 SELL CALL contracts, the whole situation felt like a ticking timebomb.
Nvidia’s stock price has been on a tear, surging more than 80% this year alone. As the company continues to innovate and expand its footprint in AI, its market capitalization has ballooned to a staggering $2.2 trillion, surpassing Alphabet (Google’s parent company) and Amazon as the 3rd most valuable company in the world.
My Hedge Strategies
In January 24, I used the more conservative SOP Strategy to earn premiums from the rising/ stagnant share price of Nvidia.
I then move on to using the BUY CALL strategy which is riskier but is more powerful to capitalize on bullish uptrends.
The details of my trades can be found on my Patreon page as I usually update on the same day of my trades, lest those late-hour trades which I would update on the following day.
Click here to view my Winning Trades Collection
Concluding Thoughts
While the phenomenal rise in share price brings bad news to my bearish Nvidia options positions, the hedges helped me earn good profits to offset the loss that I could potentially incur on the other side of the trade. It also helps in improving my excess liquidity so that I lower the risk of liquidation.
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If you are interested to find out more about my options trades and investment portfolio, I will be updating them on Patreon (on the same day I made the trades), so do follow me there if you need some reference or inspiration.
The gains in my Nvidia hedges also helped to reduce my overall loss in options trading to around -25k, which is pretty amazing progress, considering I once cut more than 400k losses back in 2022 as well as lost more than 45k in 2023.
Related Articles:
I Closed All My Remaining LEAPS CALL Positions At A Total Loss of SGD415K (USD306K)
-$28,162.33 Trading Losses (Sept 23)
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