Semiconductor ETF options show caution ahead of Nvidia results

Traders in the options markets are bracing for industry-wide volatility when AI-chipmaker
Nvidia
reports results on Wednesday, with defensive options contracts on a major semiconductor ETF drawing heavy trading.
For VanEck Semiconductor ETF, the largest semiconductors ETF with some $22 billion in assets, about 2.4 put options changed hands daily over the last 10 days against every call option traded, the most defensive the trading has been in about 10 months, according to Trade Alert data.
Call options convey the right to buy shares at a fixed price in the future while put contracts offer the right to sell the shares at a given price.
Play Video
Pause
Skip Backward
Skip Forward
Unmute
Current Time
0:00
/
Duration
0:00
Loaded
:
0%
0:00
Stream Type
LIVE
Seek to live, currently behind live
LIVE
Remaining Time
-
0:00
1x
Playback Rate
Chapters
Chapters
Descriptions
descriptions off
, selected
Captions
captions settings
, opens captions settings dialog
captions off
, selected
Audio Track
default
, selected
Picture-in-Picture
Fullscreen
This is a modal window.
Beginning of dialog window. Escape will cancel and close the window.
Text
Color
White
Black
Red
Green
Blue
Yellow
Magenta
Cyan
Opacity
Opaque
Semi-Transparent
Text Background
Color
Black
White
Red
Green
Blue
Yellow
Magenta
Cyan
Opacity
Opaque
Semi-Transparent
Transparent
Caption Area Background
Color
Black
White
Red
Green
Blue
Yellow
Magenta
Cyan
Opacity
Transparent
Semi-Transparent
Opaque
Font Size
50%
75%
100%
125%
150%
175%
200%
300%
400%
Text Edge Style
None
Raised
Depressed
Uniform
Drop shadow
Font Family
Proportional Sans-Serif
Monospace Sans-Serif
Proportional Serif
Monospace Serif
Casual
Script
Small Caps
Reset
restore all settings to the default values
Done
Close Modal Dialog
End of dialog window.
"The put buying in SMH ahead of Nvidia's earnings reflects growing concern about potential volatility for the entire sector following the report," said Chris Murphy, co-head of derivative strategy at Susquehanna Financial Group.
On Tuesday, some 105,000 put options changed hands against about 16,000 call options, by 3 p.m. ET (1900 GMT), Trade Alert data showed.
Live Events
In one notable trade, one investor last week bought 50,000 put options in SMH that would guard against the ETF's shares slipping about 10%, to below $220, by the end of May.
Discover the stories of your interest
Blockchain
5 Stories
Cyber-safety
7 Stories
Fintech
9 Stories
E-comm
9 Stories
ML
8 Stories
Edtech
6 Stories
Nvidia accounts for about a fifth of the semi ETF's assets but due to its dominance in the artificial intelligence market, the chipmaker's influence goes beyond its weight in the fund, analysts said.
While investors have been focused on defensive plays in the SMH ETF, options action on Nvidia itself was more mixed, Murphy said.
Murphy said investors were selling options to take advantage of heightened volatility expectations around the chipmaker's earnings, meaning they were betting the reaction to the chipmaker's results will not be overly severe.
"It's been hedging in SMH while in NVDA they're tactically monetizing elevated premiums ahead of earnings," he said. Susquehanna makes markets in the securities of Nvidia.
Interactive Brokers' list of the 25 most active securities by client orders showed Nvidia ranked second, underlining the heightened investor interest in the results. Still, the stock was only one of two names for which investors were net sellers.
"That likely reflects some caution ahead of earnings after a solid run," Steve Sosnick, Interactive Brokers' chief strategist, said in a note. Nvidia will be the last of the "Magnificent Seven" megacap tech and growth companies to report results for this period. Their stocks have been mixed in 2025 after leading the market higher as a group in the last two years.
For the year, Nvidia shares are up about 0.7%, while SMH shares are up about 1.2%.

Try Our AI Features

Explore what Daily8 AI can do for you:

Learn with AIFact CheckingText to SpeechAI Summary

Related Articles

Time of India

29 minutes ago

• Time of India

Xiaomi YU7 SUV launch date revealed in China: Expected to come with top speed of 253 km

AllNewsAppsScience And Future Xiaomi Drives into EV SUV Market with YU7, Launching June 26 in China | Credit: Xiaomi Xiaomi 'Human x Car x Home' event set in China: Xiaomi is set to redefine the boundaries of smart living with its upcoming Human x Car x Home ecosystem launch event in China, scheduled for this month. This live showcase is expected to unveil the next wave of Xiaomi products—from electric SUVs to AI smart glasses—all powered by HyperOS and designed for seamless integration across devices and environments. Marking a bold leap into 'everything connected' living, the event highlights Xiaomi's mission to blur the lines between personal gadgets, mobility, and home automation. As anticipation builds, tech enthusiasts and ecosystem fans are eager to see how these innovations will transform daily life. Stay tuned as Xiaomi brings human-centred design and intelligent connectivity to the next level. Xiaomi YU7 SUV confirmed launch date in China #XiaomiYU7 is about to make its official debut. An advanced smart wearable will also join the grand reveal. Mark your calendars on June 26th at 19:00 (GMT+8), and let's witness #NewBeginnings at the 「Human x Car x Home」 Launch Event. — Xiaomi (@Xiaomi) June 23, 2025 China will host Xiaomi's annual ecosystem event, "Human x Car x Home," on June 26, 2025. It will be live-streamed on Weibo and begin at 7:00 PM CST (or 4:30 PM IST). Xiaomi YU7 SUV expected features Mark your calendars on June 26th at 19:00 (GMT+8) | Credit: Xiaomi The Xiaomi YU7 is a mid-to-large SUV with a wheelbase of 3000 mm and measurements of 4999 mm (L) x 1996 mm (W) × 1600 mm (H). With a wheel-to-body ratio of 3:1, a wheel-to-height ratio of 2.1:1, and a width-to-height ratio of 1.25:1, it maintains the brand's fixation with proportions. It embodies the traditional low-slung stance of high-performance SUVs. A 1:3 ultra-sleek head-to-body ratio and a 680 mm long L113 (distance from the centre of the front wheel to the brake pedal), a characteristic of automotive elegance honed over a century, are important luxury features. After months of optimisation, the 3.11 ◡ clamshell aluminium hood (1960×1587 mm), the largest in mass-produced automobiles, blends in perfectly with the body. A 141 L electric front trunk that can accommodate up to eight opening modes is located underneath it. Sporty wheel arches and optional 275 mm rear wide tyres add to the high-performance look. The Xiaomi YU7's family design philosophy is evident in many fine elements and its well-proportioned body. The Xiaomi SU7's iconic "waterdrop headlights" are restored in this model thanks to an inventive hollowed-out design. Unmatched in its class, the Xiaomi YU7's headlamps have an open design with air channels connected to the front hood vents. This technical marvel uses 180° ultra-wide-angle lighting to improve illumination and intensify the overall visual aggression. The Xiaomi YU7 unveils three vibrant, nature-inspired paint finishes: Lava Orange, Titanium Silver, and Emerald Green. For the latest and more interesting tech news, keep reading Indiatimes Tech. First Published: Jun 23, 2025, 14:40 IST I am a versatile content writer who enjoys creating interesting, educational, and SEO-friendly content. I've spent over 4 years honing my talents in generating interesting articles, blog posts, product descriptions, and social media content. My writing style is adaptable, allowing me to cover a wide range of topics, from technology and trends to travel and lifestyle. I have a great command of language and a keen eye for detail, so my content is error-free and polished. I enjoy researching and providing well-researched, factually accurate material. Read More 23/6/2025 15:4:47

Time of India

2 hours ago

• Time of India

European shares slip as US strikes on Iran fuel Middle East escalation fears

European shares fell on Monday after the U.S. decision to join Israel in striking Iran's nuclear facilities over the weekend heightened investor fears of an escalation in the Middle East conflict . The pan-European STOXX 600 index was down 0.3% at 535.11 points, as of 07.12 GMT. Other major regional indexes also traded lower. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Dhoni's Exclusive Home Interior Choice? HomeLane Get Quote Undo Iran and Israel exchanged air and missile strikes on Monday, as global tensions rose over Tehran's expected response to a U.S. attack on its nuclear facilities over the weekend. In a post to the Truth Social platform on Sunday, U.S. President Donald Trump questioned the possibility of regime change in Iran. Markets fear that an Iranian retaliation may include a closure of the Strait of Hormuz , the world's most important oil artery. Live Events Bucking the sombre mood, the oil and gas sector led gains in the regional index, rising 0.7%, as oil prices jumped on fears of supply disruption following the weekend strike. Travel and leisure stocks lost 0.8%. Among stocks, Spectris rose 14.6% after private equity firm Advent said it will acquire the scientific instruments maker in a deal valued at 4.4 billion pounds ($5.91 billion).

Mint

2 hours ago

• Mint

Oil price today: MCX crude price hits Jan 2025 high post escalation in Israel-Iran war, fear of Hormuz Strait closure

Oil price today: Crude oil prices rose on the Multi Commodity Exchange (MCX) on Monday following the US's alignment with Israel in military actions targeting Iran's nuclear facilities, which heightened tensions in the Middle East. Worries are increasing regarding possible disruptions in supply, especially the potential closure of the Strait of Hormuz, a vital passage for worldwide crude transportation. MCX crude oil futures for July contract opened higher at ₹ 6,475 per barrel as against its previous close of ₹ 6,404 level. MCX crude oil prices rallied 2.28% to a high of ₹ 6,550, and were last trading 1.80% higher at ₹ 6,519 per barrel. In the global market, prices for Brent Crude Oil surged on Monday to their highest level since January as the U.S. decided to support Israel in military actions against Iran's nuclear facilities, raising concerns about supply. Brent crude futures increased by $1.88, or 2.44%, reaching $78.89 a barrel at 1122 GMT. Meanwhile, U.S. West Texas Intermediate crude rose by $1.87, or 2.53%, to $75.71, according to a report from Reuters. Since the conflict started on June 13, Brent has climbed 13%, while WTI has seen an increase of approximately 10%. Prices increased after U.S. President Donald Trump claimed he had "obliterated" Iran's main nuclear facilities during strikes over the weekend, in coordination with an Israeli attack, escalating the tensions in the Middle East as Tehran pledged to protect itself. Iran ranks as the third-largest crude oil producer within OPEC. Market observers anticipate further price increases due to growing concerns that retaliation from Iran could involve closing the Strait of Hormuz, a key passageway for approximately one-fifth of the global crude oil supply. 'Even though the possibility of the closure of Hormuz Strait is a threat, it is important to understand that this has always been only a threat and the Strait had never been closed. The fact is that the closure of Hormuz Strait will harm Iran and Iran's friend China more than anyone else,' said Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments. According to Kotak Institutional Equities, the recent oil price spike is primarily driven by market worries about the Iran-Israel conflict. While risks have increased on shipping in Strait of Hormuz (SOH), so far there is no impact on supplies. Prior to the conflict, oil markets were well-supplied. Rather, OPEC+'s planned reversal of voluntary cuts was an overhang. 'In our view, due to the conflict, some of Iranian oil production is impacted (current production ~3.5 mb/d, exports ~1.7 mb/d); there is significant OPEC+ spare capacity of ~6 mb/d. Also, at higher than US$70/bbl, the US could see further increases in production. We do not expect oil prices to remain elevated for long and maintain our oil price assumption of US$70/bbl for FY2026/27E and LT,' said the brokerage in its report.