• Nvidia’s value skyrocketed, becoming the top GPU maker with an over $2 trillion valuation
• Investors can bet against Nvidia via different methods, including inverse ETPs, without needing a margin account

Nvidia (NVDA) is the largest Graphics Processing Unit (GPU) producer in the world by market capitalisation (MC), bigger than the combined market cap of Intel, and AMD.

Recently the company has undergone some serious momentum with shares jumped over 73% since the start of the year as the company MC nearly doubled from $1.2 Trillion to $2.2 Trillion over the same period.

This has left many investors wondering how they can short the GPU manufacturer in the first place.

Firstly, what is short selling?

Short selling is a trading strategy based on the expectation that a stock’s price will decline.

It involves borrowing shares of a stock that the trader believes will decrease in value and then selling those borrowed shares at the current market price.

Here are the steps:

1. Borrow: The trader borrows shares of a stock from a broker, with the obligation to return them at a future date.
2. Sell: The borrowed shares are immediately sold at the current market price.
3. Buy Back: If the stock’s price falls, the trader buys the same number of shares back at the lower price.
4. Return Shares: The trader returns the shares to the broker from whom they were borrowed.
5. Profit or Loss: The difference between the sell price and the buyback price is the trader’s profit or loss, minus any fees or interest charged by the broker for the borrow.

Source: Silopedia

Now that you know what shorting is, let’s explore how it can be done.

What are the options of shorting Nvidia:

Shorting the stock outright

This is the most common option, but investors need to qualify for a margin account, be approved by a broker and deposit a certain sum of money to be able to borrow and short shares of Nvidia. This is also risky, as losses are hypothetically unlimited if the price of Nvidia continually rises.

Derivatives

Another way of getting short exposure to Nvidia stock is using complex financial instruments such as options, warrants, futures, and CFDs.

They are popular instruments among investors, however come with their own share of complexities.

ETPs

Last, but not least, investors can buy Inverse (aka “Short”) Nvidia ETPs to profit from declines in the underlying shares.

What are the Benefits of using ETPs?

Benefits of ETPs over options, futures and other alternative are summarised here:

Source: Leverage Shares

Trading „Short & Leveraged ETPs“, provides investors with the following benefits:

• No need for a margin account, invest from just 1 ETP share
• Losses are capped at the amount invested
• Traded in multiple currencies
• Constant leverage factor

Trade Short & Leveraged NVIDIA ETPs with Leverage Shares

Leverage Shares provides a range of Short & Leveraged Single-Stock ETPs that enable investors to take a short position on Nvidia.

These products can be traded like any other stock or ETF via a normal brokerage account.

Leverage Shares -1x Short Nvidia

Leverage Shares -3x Short Nvidia