To The Moon

$NVIDIA(NVDA)$  

$NVDA: The CEO admitted the affair. The board opened a probe. Do I sell puts?

What actually happened

• Sunday, Nov 8: Jensen Huang emailed Nvidia staff. In his words: "I was unfaithful to my wife. My actions hurt her and our children. There is no excuse for what I did." He said he had "fallen short" of his responsibility to shareholders and employees, and that he is "fully committed to Nvidia."

• The same day, Nvidia's board opened an independent investigation, run by independent directors with outside counsel. The board said it "has no reason to believe that either national security or NVIDIA secrets were compromised," but that its inquiry "will examine all available information." It also said it has confidence in Huang and his leadership team.

• Nvidia's spokesperson: "Today's news will not slow NVIDIA. Jensen is committed to continuing to lead NVIDIA as CEO without interruption."

How we got here (as reported)

• Oct 29: The New York Times reported a close relationship between Huang and an executive at Megaspeed, a Singapore-based Nvidia customer, and that US intelligence suspected she may be working for Beijing. NVDA fell about 3% the next day.

• Oct 31: The Wall Street Journal reported that US, Singapore and Taiwan authorities all had reason to suspect her.

• Nov 4–5: Three House Republican committee chairs asked Huang to attend a closed-door briefing on Nov 18.

• Nov 6: The NYT and Financial Times reported she had been recruited to spy on Huang. Sen. Chris Coons: "Congress will investigate."

These are reports and allegations. Nothing has been proven, and no charges have been reported.

Why the stock could fall on this

1. Key-person risk. Huang is the founder and owns about 3.6% of the company (2026 proxy), and no successor has been named publicly. Dan Ives expects him to stay on near-term, but says there is "clearly risk" he could be removed, depending on the investigation.

2. Policy risk. Ives expects several congressional investigations and more scrutiny of Nvidia's chip sales to China. The Commerce Department has been looking at whether Megaspeed helped Chinese firms get around export rules (NYT).

3. Timing. Earnings are Nov 17 and the House briefing is Nov 18. That's two events on back-to-back days.

Why it may not be a big new selloff

1. The business numbers haven't changed. Q3 guidance is $108B ±2%, against a consensus of about $108.8B. The board says it has no reason to believe secrets were compromised.

2. Part of it is already priced in. NVDA closed Friday at $186.64, already 23% below its 52-week high of $243.37. Most of that drop came from the AI selloff: −9.26% on Thursday alone, before any of Sunday's news.

3. The early weekend reaction was modest. An NVDA proxy on Hyperliquid was down about 1.6–2% on Sunday. Stock futures were slightly higher Sunday evening (CNBC).

My read: Monday can open lower on the headlines, but the direction will be decided by the Nov 17 earnings. The headlines set the mood; the numbers set the trend.

Checking it against my sell-put rules

❌ Trend: $186.64 is 8.8% below the 200-day ($204.67). It's below the 20-, 50- and 200-day lines, and RSI is about 31.

❌ Earnings: Nov 17 falls inside any December expiry. I don't sell in the 7 days before earnings.

❌ Event risk: an open board investigation plus a congressional briefing. That's not a risk I can price.

✅ Volatility: about 50% IV with an IV rank of about 74 (Nov 5). The premium is rich, but it's rich because of all of the above.

The strike I'm watching (illustration only, not a trade)

• Dec 18 expiry, 39 days: 1 standard deviation down ≈ $156

• $155 put ≈ delta 0.11, too far out to be worth selling

• $160 put ≈ delta 0.15, model premium ≈ $2.49, break-even ≈ $157.5

• $160 is below the 52-week low ($164.27). That's where I'd want my strike.

When I'll sell

1. Earnings (Nov 17) and the House briefing (Nov 18) are behind us

2. Nothing new and negative from the board investigation

3. A daily close back above the 200-day

Then it's a Tier 1 trade: 5% size, stop at 2× the credit, take profit at 50%, re-pricing the strike at that day's IV.

The verdict: rich premium, wrong week. I'd rather sell NVDA puts a few days late than get assigned in the middle of an investigation into the CEO.

Personal framework, education only, not advice. Premiums are Black-Scholes estimates, not live quotes. The allegations above are as reported by named outlets and have not been proven. Options carry risk, including assignment.

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