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Investors have been using the largest company in the world — Nvidia — as a cash machine this month. Nearly 20% off its all-time high, the AI leader has dropped from a $5 trillion market cap to a $4 trillion valuation in just a few quarters. I want to use options to possibly establish a long position as I anticipate the Strait of Hormuz reopening and equity markets recovering short-term. As of late March, the equity market has officially flipped the script on its longtime love affair with Big Tech. The “Magnificent Seven” have seen significant profit-taking as the Iranian conflict has caused tremendous pain in the broader global equity markets shaving trillions of dollars in S & P 500 value. Nvidia is currently trading at its lowest forward P/E ratio in the last five years. With a forward P/E of 20, I like to look at NVDA almost as a value proposition. Chip demand and data center buildouts are still major themes in 2026 and beyond. I believe there will be a resolution with Iran but, as soon as the Strait opens up, I expect a 3%-5% broad market rally … regime change or not. The trade Sold NVDA 4/24/26 $160 put for $4.00 Bought NVDA 4/24/26 $175 call for $5.25 This risk reversal will cost an investor $1.25 or $125 This spread was executed when NVDA was just trading under $170 DISCLOSURES: Kilburg is long NVDA and long this spread. All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, or its parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
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