Trade Alert: Adding Short Exposure

Taking advantage of the mild, pre-tariff announcement rally.

A Mild Rally Ahead Of The Tariff Announcement

With the markets up slightly ahead of President Trump’s “Liberation Day” announcement this afternoon, I’ve taken the opportunity to add a little short exposure.

In Case We Get A Big Leg Down

One thing a number of observers have noted about our current correction is that it’s been pretty orderly: there hasn’t been the big spike in volatility and panic selling one might see near a bottom. Today’s trades are essentially a hedge against another leg down to that sort of panic bottom, going out to May. I’ve used expiration dates in May here partly because it seems likely we would bottom out before then if we have another leg down, and partly to save money. We can always add longer dated bearish bets if that seems warranted next month.

All of these trades are on tech stocks that look vulnerable if we get another leg down.

Details below.

Bearish Trade #1

The stock is Nvidia ( NVDA 0.00%↑ ) and our trade is buying the $90 strike puts on it expiring on May 16th for $1.19. The max loss on 2 contracts is $2.38, and the break even is with NVDA at $88.81. This trade filled at $1.17.

Bearish Trade #2

The stock is Broadcom (AVGO 0.00%↑), and our trade is buying the $140 strike puts expiring on May 16th for $1.74. The max loss on 2 contracts is $348, and the break even is with AVGO at $138.26. This trade filled at $1.74

Bearish Trade #3

The stock is Arm Holdings (ARM 0.00%↑), and our trade is buying the $85 strike puts expiring on May 9th, for $1.82. The max loss on 2 contracts is $364, and the break even is with ARM at $83.18. This trade filled at $1.82.

Exiting These Trades

For each trade, I’m going to open a GTC order to exit half of the contracts at about 2x what I paid for them, and aim to sell them all before expiration.