Two nights ago I wrote about how NVIDIA’s stock looked attractive...
One of the things I liked was I felt the market overreacted to the recent earnings announcement and the stock was due for a rebound from its well below 30 day moving average price. Unfortunately I didn’t get levered long NVIDIA via the options I mentioned, and of course now the stock is up 5% in the last two days (it was up over 10% briefly Wednesday morning) while the Nasdaq is down 26 bps during the same period.
Simple front month call options would have resulted in profits several times greater than the 5% and 10% mentioned above. In trading you win some and you lose some, but you’ll never win if you don’t at least throw your hat in the ring! I think NVIDIA is still due to outperform the Nasdaq in the near term, but at this point I’m not willing to buy because I feel the risk reward is less attractive now.
