Options Traders Line Up Hedges Before Pivotal Nvidia Earnings

Even before Friday’s slide jolted the US stock market out of its calm, some traders were preparing for unrest.

While the S&P 500 Index was hovering near an all-time high and the Cboe Volatility Index was well below its five-year average, under the surface a more skeptical picture was shaping up — one that’s been already vindicated by the biggest selloff in two months. Last week, the ratio of outstanding VIX call options relative to puts neared its highest level since September 2023, with more than 1 million calls changing hands on Tuesday.