Nomura Q3 Preferred Options Strategy: Bearish on NVIDIA, Large Reduction in Dollar Tree Among the Seven Giants of US Stocks

According to the disclosure by the U.S. Securities and Exchange Commission (SEC), Japan-based financial giant Nomura (NOMURA HOLDINGS INC) has released its holdings report (13F) for the third quarter ending September 30, 2024.

The latest data shows that Nomura's total market value of holdings in Q3 was $43.6 billion, down from $52.2 billion in the previous quarter, a decrease of 16.5% quarter-on-quarter. In Q3, Nomura added 374 new positions, increased holdings in 412 positions, reduced holdings in 521 positions, and completely exited 614 positions; the top ten holdings accounted for 42.61% of the total market value.

Among Nomura's top ten holdings, there is a concentration in index options and technology stocks, with index options having a high proportion among the top ten holdings. In the third quarter, Nomura simultaneously sold call and put options on the Nasdaq-100 ETF and Russell 2000 Index ETF—constructing a short straddle strategy, which suggests that Nomura may believe that the volatility of the Nasdaq-100 and Russell 2000 indices corresponding to the ETFs will significantly decrease; this strategy is suitable for expectations of a sideways market, meaning low volatility and no significant fluctuations in the corresponding indices. Additionally, while selling put options on the S&P 500 Index ETF, Nomura bought call options, indicating that the firm may believe the S&P 500 Index is likely to trend upward.

In terms of individual stocks, Nomura simultaneously bought Tesla (TSLA.US) and put options on the stock—constructing a Protected Put strategy, which is suitable for situations where one is bullish on the underlying asset price but wants to avoid downside risk. Furthermore, while buying shares of Apple (AAPL.US), Nomura also bought call options on the company and sold put options, indicating that the brokerage's operations in the third quarter were generally bullish on Apple's stock price. Additionally, based on changes in operations in the third quarter, Nomura is overall bullish on Meta (META.US), Microsoft (MSFT.US), Google (GOOGL.US), and Amazon (AMZN.US).

It is noteworthy that in the third quarter, while selling shares of NVIDIA (NVDA.US), Nomura bought put options on the stock and sold call options, indicating that the brokerage's operations in the third quarter were generally bearish on NVIDIA's stock price.

Among the main underlying stocks held by Nomura are NVIDIA (NVDA.US), Tesla (TSLA.US), Meta (META.US), and Dollar Tree (DLTR.US). NVIDIA and Tesla account for 4.02% and 2.5% of the portfolio, respectively, ranking fifth and seventh. Notably, the number of shares held in NVIDIA and Dollar Tree decreased, while the number of shares held in Tesla and Meta increased significantly, with increases of 1262% and 370%, respectively

From the changes in holding ratios, Nomura's top five buying targets are: Tesla (TSLA.US), Tesla put options (TSLA.US, PUT), NVIDIA put options (NVDA.US, PUT), Valero Energy call options (VLO.US, CALL), Coinbase bonds (DEBT-COIN).

The top five selling targets include: SPDR S&P 500 ETF put options (SPY.US, PUT), NVIDIA call options (NVDA.US, CALL), Dollar Tree (DLTR.US), Cognizant Technology Solutions (CTSH.US), Nasdaq 100 ETF - Invesco QQQ Trust call options (QQQ.US, CALL).