Pelosi banks $1.4M Nvidia stock option trade, outraging watchers

Nancy Pelosi made a big profit from stock options in NVIDIA, sparking concerns about politicians trading individual stocks. #Pelosi #Stocks

Late last year, U.S. Representative Nancy Pelosi made a significant transaction by purchasing call options in NVIDIA Corporation (NASDAQ:NVDA). This move came after a substantial rally in the stock due to impressive AI adoption and the company's strong financial performance. As a result, Pelosi is now reportedly sitting on a substantial windfall profit.

According to historical options data, Pelosi paid an estimated $380 per option contract in late November for 50 December 20, 2024, 120 call options. Each option contract represents 100 shares of the underlying stock. These options are now valued at about $660 per option contract, indicating an estimated gain of $1.4 million. When Pelosi publicly disclosed the trade in late December, it was revealed that she had paid between $1 million and $5 million for the options.

Chris Josephs, co-founder of Autopilot, a service that automates portfolios by copying top traders in real-time, described the NVDA buy as "one of the larger ranges." He also noted that the option buy occurred on November 22, 2023, and the stock has since risen by 63%.

Josephs expressed ethical concerns about politicians trading individual stocks, emphasizing that it creates distrust in society and erodes trust in institutions. He argued that politicians should not be allowed to engage in such trading and highlighted Autopilot as a way to bring awareness to this issue.

He also pointed out that other politicians, including Markwayne Mullin (R), David Kustoff (R), Mike Mccaul (R), and Josh Gottheimer (D), own shares in Nvidia. Josephs raised concerns about Senator Mullin's purchase of $30,000 of Badger Meter Inc (NYSE:BMI), a company that produces automated water meter technology, given his position on the Environmental Services Senate Committee.

Josephs also discussed Pelosi's recent purchase of call options on Palo Alto Networks Inc (NASDAQ:PANW). He noted that this purchase coincided with a 10% increase in the stock's value, suggesting that more people are paying attention to her trades.

Forbes reported that U.S. representatives and senators receive lifetime pensions and a taxpayer-matched savings plan. Pelosi's annual salary was reportedly $223,500, indicating that she made more than six times her annual salary from the NVDA option trade.

Josephs also mentioned Pelosi's other investments in artificial intelligence and big tech stocks, including Microsoft Corporation (NASDAQ:MSFT) and Apple Inc (NASDAQ:AAPL). While the size of her total portfolio is unknown, the year-to-date performance is up 12%.

Nvidia shares have rallied significantly over the past 12 months, climbing more than 240%. The stock is currently up almost 61% year-to-date, with a market capitalization of $1.98 trillion. Rosenblatt recently raised its price target for Nvidia to a new Street high of $1,400, citing the company's impressive quarterly earnings and the shift to accelerated compute.

Nancy Pelosi's office has not responded to a request for comment on the Nvidia stock option trade at the time of this publication.