$NVDA bears triple money overnight

Bearish option traders are seeing fast profits today in NVIDIA Corporation (NVDA).

Yesterday on Jun. 9, Market Rebellion’s Unusual Option Activity Service found that 10,000 July $155 puts were bought for $2.21 with shares at $191.33. This was clearly fresh buying, as open interest in the contract was just 2,987 before the activity appeared.

Those puts have traded up to $6.45 this morning, nearly 3 times their purchase price. The stock fell 11.52% in the same time frame, showing how quickly options can far outperform moves in their underlying shares on a relative basis.

Long puts lock in the price where a stock can be sold no matter how far it might drop, gaining value in a selloff with the potential for significant leverage. The contracts can be purchased either as an outright bearish bet or a hedge on a long-stock position.

NVDA is currently lower by 6.19% at $169.30.