The S&P is officially in correction territory down 10% and while many people are panic selling, I am nibbling at the market. This isn’t financial or trading advice so do your own due diligence and invest in the way that meets YOUR goals.
I bought 100 shares of NVDA at around $116.50 and I sold the December 19 2025 $150 strikes for $11 which earned me an immediate and sweet $1,100 (9.44%). That premium money is now in my bank account and mine to keep and from here there are two possibilities.
NVDA goes to the moon
If NVDA suddenly rallies and breaks above $150, I must sell at $150 but since I bought it at $116.50, that would be an additional $33.50 ($3,350 or +29% return). Assuming this scenario happens, it’ll be 38.44% return for the year.
NVDA goes to the abyss
If NVDA suddenly drops to say $50 then I will still keep the $1100 in premiums but have paper loss until NVDA recovers at some point in the future.
But how long into the future and what if it doesn’t recover? Well, that’s why it’s called risk there are no guarantees in investing. My risk mitigation strategy here is to own this long term (10+ years) and let it grow.
Why NVDA?
After using AI on a daily basis and knowing full well we are at the start of a whole new computing paradigm, I am willing to take the risk. NVDA is at about 18x earnings right now and that’s ridiculously low for a high flying tech stock.
Why not 1000 shares?
I am pacing myself. The new administration’s tariffs will officially go into effect on April 2 so there may be more stock market carnage and if NVDA drops some more, I will repeat the strategy. I will buy at every 10% pullback or maybe less depending on what else is happening in my portfolio.
Share The Wealth
Are you buying anything in this market? Let me know in the comments below.