Short Bets Against Nvidia Reach $34 Billion as Company Eyes Microsoft’s Throne

Investors are doubling down on short bets against Nvidia, with outstanding short positions now totaling a staggering $34 billion, according to data from S3 Partners. As Nvidia’s market value edges closer to dethroning Microsoft as the world’s most valuable company, some investors are wagering that the tech giant’s meteoric rise may soon hit a stumbling block.

The $34 billion in short bets against Nvidia dwarfs those against other tech titans, with short positions against Apple and Tesla combined totaling just under $37 billion. S3 Partners’ report reveals that short sellers have bet approximately $19 billion against Apple and $18 billion against Tesla, highlighting the significant focus on Nvidia in the short-selling community.

However, despite the substantial sum, these short bets against Nvidia represent only a small fraction — approximately 1% — of the company’s total stock market value, as per data from LSEG. This suggests that while short sellers are betting against Nvidia’s ascent, the broader market remains overwhelmingly bullish on the company’s prospects.

Nvidia’s Soaring Stock and Nvidia’s market value

Nvidia’s extraordinary stock performance in 2024 has fueled its ascent in the market, driven largely by insatiable demand for its high-end AI processors. The company’s shares have surged an impressive 143% since the beginning of the year, propelling Nvidia’s market value to unprecedented heights.

On Wednesday, Nvidia’s market capitalization reached a monumental milestone, surpassing the trillion-dollar mark and eclipsing Apple to claim the title of the world’s second most valuable company. This momentous achievement underscored Nvidia’s position as a formidable force in the tech industry, with its innovative products and robust financial performance capturing the attention of investors worldwide.

Despite this triumph, Nvidia experienced a slight pullback in its market value on Thursday, with shares declining by nearly 2%. Nevertheless, the company’s market capitalization still stands at a formidable $2.96 trillion, reaffirming its status as a heavyweight in the global market.

Microsoft Maintains Lead Amidst Tech Titans’ Battle

While Nvidia’s ascent has captured headlines, Microsoft continues to reign supreme as the world’s most valuable company. With a market value of $3.15 trillion, Microsoft retains its leadership position despite facing stiff competition from its tech counterparts.

Microsoft’s stock has seen a notable uptick, climbing 13% year to date and solidifying its dominant position in the market. As Nvidia aims to challenge Microsoft’s throne, the tech landscape remains fiercely competitive, with each company vying for supremacy in an ever-evolving industry.

As investors navigate the dynamic tech market, the battle for the top spot intensifies, with Nvidia’s soaring stock and formidable market value signaling its ambition to disrupt the status quo. However, as Microsoft maintains its lead, the stage is set for a compelling showdown between these tech giants, with the outcome poised to shape the future of the industry.

Curious to learn more? Explore this News on: Mr. Business Magazine