Short sellers have made nearly $5 billion in paper profits from Nvidia’s recent three-day selloff, as reported by Ortex Technologies, a data analytics firm. Nvidia, a prominent AI chip designer, saw its stock plummet 13%, shedding $430 billion in market capitalization since June 18. This drop occurred shortly after Nvidia briefly held the title of the world’s most valuable company following a remarkable surge.
On Monday alone, short sellers earned $2.40 billion from Nvidia’s 6.6% decline, marking the most significant one-day gain since Ortex began tracking data in 2019. This significant profit highlights the volatile nature of the stock market and the opportunities it presents for short sellers.
Some analysts attribute Nvidia’s recent decline to investors shifting their focus from high-performing AI stocks to other sectors as the mid-year mark for 2024 approaches. This rotation is seen as a strategic move by investors looking to diversify their portfolios.
Despite the recent downturn, Nvidia’s stock has surged 145% this year, making it the second-best performer on the S&P 500. The ongoing optimism surrounding Nvidia’s pivotal role in the artificial intelligence revolution continues to drive its impressive performance.