Trade Alert: Quantum Computing

Betting against a stock up big today that has lockups expiring next week.

The Time Frame For Useful Quantum Computing

At a conference earlier this month, Nvidia ( NVDA 0.00%↑ ) CEO Jensen Huang was asked when he thought quantum computing would actually be useful. This was his answer:

If you said 15 years for very useful quantum computers, that would probably be on the early side. If you said 30, it's probably on the late side. But if you picked 20, I think a whole bunch of us would believe it.

That caused quantum computing stocks to tank, but they’re spiking again today.

One With A Lockup Period Expiring

One stock in particular that is up more than 30% today launched a secondary offering back in November. Institutional investors who bought then are up about 600% now, and according to one of the analysts on my Market Watchers X list, the lockup period for those investors ends next week (meaning they will be allowed to sell and take some profits).

Our trade today is a bet that this stock will drop by about 24% by the end of next week. If we’re right, we’ll make about 185% on our trade; if we’re wrong, we could lose up to a 100%.

Details below.