Review: 30/10/2024
Key data
- Ticker Symbol: NVDA
- Exchange: NASDAQ
- Fiscal Year: February – January
- Reporting Currency: USD
- IPO Date: January 22, 1999
- CIK Code: 0001045810
- ISIN Number: US67066G1040
- Address: 2788 San Tomas Expressway Santa Clara, CA 95051 United States
- Website: www.nvidia.com
Overview
NVIDIA Corporation is a pioneering technology company specializing in graphics processing, computing, and networking solutions. Established in 1993 and headquartered in Santa Clara, California, NVIDIA has become a market leader in the semiconductor industry with diverse applications in gaming, data centres, professional visualization, and automotive solutions.
NVIDIA operates through two primary business segments: Graphics and Compute & Networking, each playing a crucial role in the company’s diverse offerings.
In the Graphics Segment, NVIDIA is best known for its GeForce GPUs, which are designed for gaming enthusiasts and are among the most popular choices for gamers worldwide. The GeForce NOW service enhances this experience by providing a cloud-based game streaming platform that delivers high-performance gaming via NVIDIA’s robust infrastructure. Additionally, NVIDIA offers RTX and Quadro GPUs, which cater to enterprise users, delivering advanced graphical capabilities necessary for workstation-grade applications. The company’s virtual GPU (vGPU) software allows for high-performance visual computing over the cloud, facilitating seamless virtual workflows. In the automotive sector, NVIDIA provides infotainment solutions for in-vehicle experiences and powers the Omniverse platform, a software suite designed for creating and operating 3D internet applications and metaverse platforms.
The Compute & Networking Segment focuses on data center solutions that enable AI, machine learning, and deep learning applications across various industries. NVIDIA’s data center platforms are instrumental in supporting these advanced technologies. The company also offers networking solutions through its Quantum and Spectrum lines, which provide end-to-end networking designed for high-performance data center environments using InfiniBand and Ethernet. NVIDIA DRIVE supports autonomous driving capabilities and is part of partnerships with leading automotive manufacturers. Additionally, NVIDIA’s embedded platforms, like Jetson, provide robotics and AI solutions for various applications. The NVIDIA AI Enterprise suite is optimized for enterprises, helping industries deploy advanced AI solutions at scale, while DGX Cloud offers a comprehensive platform for cloud-based AI infrastructure to meet accelerated computing needs.
NVIDIA’s technologies are integral to multiple sectors, including gaming, professional visualization, data centre operations, and automotive innovation. The company’s products are utilized by original equipment manufacturers, system integrators, cloud service providers, software vendors, and numerous other participants in the tech ecosystem, showcasing the breadth of NVIDIA’s market reach and applications.
Main ways to invest long-term and trade actively for NVIDIA stock
Investing in and actively trading NVIDIA stock can be approached in several key ways, each catering to different investment objectives, time horizons, and risk appetites. Here are the primary methods for both long-term investment and active trading:
Long-Term Investment Methods
1. Buying Physical Stock (Direct Ownership)
- Strategy: To purchase and hold NVIDIA shares over an extended period.
- Goal: Benefit from NVIDIA’s long-term growth potential in high-demand areas like AI, gaming, and autonomous driving.
Benefits:
- Long-Term Growth Potential: Owning shares of NVIDIA directly gives investors exposure to the company’s long-term growth, especially in high-growth areas like AI, data centres, and autonomous vehicles.
- Dividends and Corporate Rights: Shareholders can receive dividends (if declared) and are entitled to voting rights, giving them some influence in corporate matters.
- Lower Risk Compared to Derivatives: Owning physical stock doesn’t have a fixed expiry and doesn’t rely on leverage, making it a less risky choice for long-term investors.
- Capital Gains and Tax Advantages: Long-term stock holdings are often eligible for favourable capital gains tax treatment.
Considerations:
- Higher Capital Requirement: Buying physical stock requires a larger upfront investment since there is no leverage.
- Limited Short-Term Profitability: Physical shares benefit from upward price movements, but they don’t offer much short-term profit potential.
- No Downside Protection: Investors in physical stock are fully exposed to any decline in the stock’s price, potentially affecting returns if the price falls.
2. Exchange-Traded Funds (ETFs)
- Strategy: To invest in an ETF that holds NVIDIA as part of a technology or semiconductor portfolio.
- Goal: Gain exposure to NVIDIA along with diversification in other tech stocks.
Benefits:
- Diversification: Reduced risk by not solely relying on NVIDIA’s performance.
- Lower Volatility: The diversified nature of ETFs can provide more stability.
- Liquidity: ETFs trade like stocks, making it easy to enter or exit positions.
Considerations:
- Potentially lower returns from NVIDIA specifically due to ETF diversification.
- Subject to management fees, which can affect long-term returns.
Active Trading Methods for experienced investors
1. Trade OTC derivatives (CFDs)
- Strategy: To trade NVIDIA’s price movements without owning the stock, using leverage.
- Goal: Capitalize on short-term price movements, whether up or down.
Benefits:
- Leverage and Lower Capital Requirements: CFDs allow traders to open larger positions with less capital, amplifying both potential gains and losses.
- Ability to Trade in Both Directions: Traders can take advantage of both rising (buy CFD) and falling markets (sell CFD) without the restrictions of short-selling.
- No Expiration Date: Unlike options, CFDs don’t expire, making them more flexible for both short- and long-term strategies.
- No Ownership, Only Price Exposure: CFDs allow traders to gain exposure to NVIDIA’s stock price without actually owning the underlying asset, simplifying tax reporting and corporate actions.
Considerations:
- Higher Risk Due to Leverage: Leverage can significantly amplify losses, requiring careful risk management to avoid substantial losses.
- Overnight Financing Fees: Holding CFDs overnight incurs daily financing fees, which can add up over time and reduce profitability, especially for long-term trades.
- No Shareholder Rights: Since CFDs don’t involve ownership of NVIDIA shares, traders don’t receive voting rights (however, Earn Broker settles dividends on single-stock CFDs).
- Regulatory Restrictions: Some countries have restrictions on CFD trading, and leverage caps may vary depending on regulatory requirements, affecting profitability.
Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68.93% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
2. Options Trading (Calls and Puts)
- Strategy: To buy call options to benefit from a potential price rise or put options to profit from a price drop.
- Goal: Gain from directional moves in NVIDIA’s stock with limited upfront capital.
Benefits:
- Leverage with Limited Capital: Options allow investors to control more shares with less capital upfront, making it possible to benefit from NVIDIA’s price moves with a smaller investment.
- Flexibility to Trade Both Sides: Buying a call option gives you the right to profit from upward price movements, while a put option allows you to gain if the price drops.
- Defined Risk on Long Options: When buying options, the maximum risk is limited to the premium paid, protecting against larger losses.
- Enhanced Profit Potential: Options can provide significantly higher returns in the short term if NVIDIA’s stock moves strongly in either direction.
Considerations:
- Expiration and Time Decay: Options contracts have expiration dates, and the value of the options erodes as they approach expiration, particularly if the stock doesn’t move as anticipated.
- Higher Complexity: Options trading can be complex, requiring knowledge of factors like strike prices, premiums, and the Greeks (Delta, Gamma, etc.).
- Higher Volatility: Options tend to have higher volatility, making them riskier and requiring close monitoring.
3. Day and Swing Trading
- Strategy: To execute short-term trades based on technical analysis and price trends.
- Goal: Capitalize on daily or weekly price swings for quick gains.
Benefits:
- High Liquidity: NVIDIA is heavily traded, making entry and exit easy.
- Quick Returns: Short time horizon allows for rapid gains.
- Frequent Opportunities: Volatility in tech stocks like NVIDIA often provides ample trading setups.
Considerations:
- Requires constant monitoring and technical analysis skills.
- Higher transaction costs due to frequent trading.
- Psychological pressure and potential for significant losses in volatile markets.
Summary
Each approach has its unique set of risks and advantages, so selecting the right method depends on your investment objectives, risk tolerance, and experience.
- Long-Term Investors may benefit most from direct stock ownership, ETFs, or DRIPs, focusing on NVIDIA’s sustained growth and market position.
- Active Traders might prefer options, CFDs, or swing/day trading strategies to profit from NVIDIA’s short-term price movements.
Earn Broker Platform Overview for NVIDIA Stock Trading
Earn Broker provides access to a wide range of financial instruments, including NVIDIA stock, catering to both long-term investors and active traders. With a suite of tools and resources, the platform aims to support informed decision-making, helping users tailor their investment strategies.
Here’s an overview of NVIDIA stock trading options on Earn Broker, along with important considerations:
Key Features of Earn Broker
- Diverse Financial Instruments: Access to NVIDIA stock through multiple investment methods, such as shares, ETFs, options, and CFDs, allowing users to select strategies based on their risk tolerance and financial goals.
- Comprehensive Tools and Analytics: Earn Broker provides market insights, technical indicators, and research resources designed to help users assess NVIDIA’s price movements and market conditions.
- Flexible Trading Options: Users can take advantage of both leveraged (CFD, options) and non-leveraged (physical stock) positions, depending on whether they aim to hold long-term or trade actively.
Investment Options for NVIDIA Stock on Earn Broker
- Stocks and ETFs: Ideal for long-term investors seeking ownership and potential dividends from NVIDIA.
- Call/Put Options: Suitable for those with short- to medium-term goals, allowing trading based on NVIDIA’s expected price movements.
- CFDs on NVIDIA stock: Offers leveraged exposure for short-term trading, allowing profit potential in both rising and falling markets.
Important Considerations
- Market Risk: All investments carry inherent risk, particularly with leveraged instruments like CFDs and options, where losses can exceed initial capital.
- Leverage and Fees: Options and CFDs involve additional costs such as premiums and overnight fees that should be factored into potential gains and losses.
- Investment Strategy: Each method (physical stock, options, CFDs) suits different trading styles, so it’s essential to align with a strategy that matches your experience and risk tolerance.
Reminder: Before investing, assess your financial situation, market outlook, and familiarity with each trading instrument. Earn Broker provides resources to help, but independent research and caution are essential to any investment decision. All investments carry risk.
Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68.93% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Account types for NVIDIA stock trading & investing
| Account Type | Platform (s) | Type of instrument accessible | Key Features | CTA |
| Trading account – MT5 Sharp ECN | MT5 | CFD | Market execution with faster order placement. Transparent, commission-based pricing. | OPEN AN ACCOUNT |
| Trading account – MT4 NDD | MT4 | CFD | Hybrid execution, potentially tighter spreads, designed for efficient price execution | OPEN AN ACCOUNT |
| Trading account – ERC (Poland) | MT4/MT5 | CFD | Tailored for experienced retail clients from Poland, lower margin requirements (conditions apply) | OPEN AN ACCOUNT |
| Trading account – Demo Account | MT4/MT5 | CFD | Risk-free trading in a simulated environment. Real-time data for practice and strategy testing. | OPEN AN ACCOUNT |
| Investment account – Earn.Broker | Earn Broker (web and mobile app) | Stocks, ETFs, options | Tailored for investors focused on portfolio building and value appreciation rather than active trading. | OPEN AN ACCOUNT |
Trading Platforms for NVIDIA stock trading & investing
Earn Broker provides access to NVIDIA stock through several trading platforms, each offering unique features and functionalities tailored to different trading styles and experience levels. Here’s an overview of the platforms available:
MetaTrader 4 (MT4)
MT4 is one of the most widely used trading platforms worldwide, valued for its simplicity and powerful features. Simple, intuitive design suitable for beginners while offering advanced tools for experienced traders. Comprehensive charting options with indicators, drawing tools, and customizable timeframes. Includes basic order types like market, limit, and stop orders. Best For Traders of all levels seeking a straightforward platform for technical analysis and manual trading.
MetaTrader 5 (MT5)
MT5 is the next-generation platform after MT4, offering enhanced features for advanced traders. Support for more asset classes, including stocks and ETFs, alongside traditional forex and CFDs. Features Expert Advisors (EAs) for automated trading and advanced algorithmic strategies. Includes additional technical indicators, more charting options, and a wider range of timeframes. Integrated calendar with real-time updates on market events that could affect asset prices. Best For Experienced traders needing advanced analysis, a broader asset selection, and automated trading capabilities.
Earn.Broker App
A mobile app and web-based terminal designed for trading and investment management on the go, with access to real-time data. Monitor and manage trades and investments from anywhere. Instant alerts for price movements, order execution, and market news. Optimized for mobile use, providing a clean and accessible interface. Access to market news, price alerts, and basic research tools directly within the app. Best For Investors and traders looking for flexible, on-the-go access to their portfolio and real-time market updates.
Selecting the right platform depends on individual trading preferences, technical needs, and desired functionality.
Trading Conditions for NVIDIA stock trading & investing
Trading Account (NVIDIA CFDs)
- Minimum Deposit: $100 or €100.
- Spread: The spread is the difference between the buy and sell price of NVIDIA, serving as a primary trading cost. Note that spreads may widen significantly during low liquidity periods, especially during the daily break from 23:59:00 to 00:05:00.
- Swap Charges (Overnight Fees): If you hold a position overnight, a swap fee applies. On Fridays, a triple swap fee is charged to account for the weekend.
- Commission per Trade: A commission of 0.1% of the trade volume is charged for each transaction executed when trading NVIDIA stock.
- Leverage: The default leverage for NVIDIA stock is 1:5, in compliance with the European supervisory bodies ESMA and MiFID II. For professional investors, Earn Broker offers leverage up to 1:50 by reducing margin requirements.
- Short-Selling Restrictions: Short-selling NVIDIA may be restricted during certain periods due to regulatory or counterparty conditions, such as before stock splits or other corporate actions. It is advisable to consult Customer Support for confirmation if you plan to short-sell.
For more information, please visit the official website (https://earn.eu/accounts/trading-conditions/costs-and-charges).
Investing Account (NVIDIA Stocks and Stock Options)
- Minimum Deposit: $100 or €100.
- FX Conversion Fee: A fee of 0.1% applies for currency conversions on the trading platform.
- Commission per Trade: A fee of $2 per order plus $0.08 per share is charged, with a minimum total commission of $5 per transaction (Standard tariff schedule). As the deposited amount increases, traders can benefit from reduced fees, with discounts of up to 60% on the fee per share for the “Exclusive” Service Plan.
- Custody Fee: A custody fee for the administration and safekeeping of securities is charged quarterly, calculated as a percentage of the position’s value.
- Marginal Lending Fee: If you use margin lending to buy NVIDIA stock, which has a default leverage ratio of 1:4 (allowing you to purchase four times the stock amount of your account balance), a negative cash balance fee will apply if you hold the position overnight.
Risks and Risk Management in Trading NVIDIA Stock and CFDs
Understanding NVIDIA Stock Trading with Earn
| Risk Factor | Description | Mitigation Strategies |
| Market Volatility | NVIDIA’s stock price can experience significant fluctuations due to various market factors. | Diversification, stop-loss orders, and position sizing. |
| Leverage | Utilizing leverage can amplify both profits and losses. | Conduct careful risk assessments, understand margin calls, and avoid excessive leverage. |
| Geopolitical Events | Global events may affect NVIDIA’s performance and the broader market. | Stay informed about geopolitical developments and adjust investment strategies accordingly. |
| Company-Specific News and Events | Positive or negative news regarding NVIDIA can have a substantial impact on its stock price. | Perform thorough due diligence, monitor news and announcements, and understand the company’s fundamentals. |
| Economic Conditions | Economic downturns can adversely affect technology stocks like NVIDIA. | Diversification and the use of hedging strategies can help mitigate risks. |
Risk Management Features & Tools
Earn Broker provides several tools to help manage risk and mitigate potential losses, though they cannot guarantee against all losses:
- Stop-loss Orders: Automatically close a position when the price reaches a predetermined level to limit losses.
- Take-Profit Orders: Automatically close a position when the price reaches a predetermined level, securing profits.
- Margin Calls: Notifications are issued when account equity falls below the required margin level, prompting traders to take action.
- Negative Balance Protection: This feature helps prevent losses from exceeding the amount deposited, although specific rules may apply.
Benefits of Using Acuity Research Terminal for Trading NVIDIA CFDs
- Data-Driven Insights: The terminal leverages AI and machine learning to provide data-driven insights and forecasts. This analytical approach can help traders anticipate market movements and make more informed decisions when trading NVIDIA.
- Real-Time Sentiment Analysis: Acuity Research Terminal provides real-time sentiment analysis derived from news articles, social media, and analyst reports. This insight helps traders gauge market sentiment around NVIDIA, enabling them to make informed trading decisions based on prevailing market attitudes.
- Enhanced Charting Capabilities: The platform features advanced charting tools that allow traders to visualize price movements and trends effectively. With various indicators and drawing tools, traders can conduct technical analysis specific to NVIDIA’s performance.
- News and Events Tracking: Acuity provides a comprehensive news aggregation feature that keeps traders updated on important events affecting NVIDIA and the tech sector. This includes earnings announcements, product launches, and other significant corporate actions, enabling traders to anticipate market reactions.
- Technical and Fundamental Analysis: The terminal combines both technical and fundamental analysis tools. Traders can analyse NVIDIA’s financials, including earnings, revenue growth, and other key metrics, alongside technical indicators to build a well-rounded trading strategy.
- Customizable Dashboards: Users can create personalized dashboards tailored to their trading preferences. This flexibility allows traders to focus on specific data points, charts, and tools relevant to their NVIDIA CFD trading strategies.
- Integration with Trading Platforms: Acuity Research Terminal can integrate seamlessly with various trading platforms, enabling traders to execute trades quickly based on the insights and analyses derived from the terminal.
- User-Friendly Interface: The intuitive layout and user-friendly interface make it easy for both novice and experienced traders to navigate the platform and access critical information without a steep learning curve.
Earn Broker’s Customer Support and Resources
Earn Broker provides customer support through various channels. These channels are designed to assist clients with account management, trading, and other inquiries. Additional educational resources are available to help traders enhance their knowledge and skills.
- Live chat
- Email support
- Phone support