Nvidia Corp.’s stock rose 1% in afternoon trade, ahead of the graphics chip maker’s first-quarter report due out after the close. An options strategy known as a straddle, expiring after Friday’s close, is prepped for a one-day post-earnings move of about 7.5% in either direction on Friday, meaning a buyer of the strategy only makes money if the stock rises or falls more than 7.5% on Friday. A straddle is a pure volatility play, that involves simultaneously buying bullish and bearish at-the-money options. Meanwhile, Nvidia’s stock has moved an average of 8.9% on the day after the past 20 quarterly reports, and moved 9.5% on the day after the past 10 reports. Over the past 20 quarters, the stock has gained the next day 12 times, for an average gain of 11.1%, while the stock fell an average of 5.6% on the eight down days. Nvidia’s stock has rallied 20.7% year to date, while the PHLX Semiconductor Index has rallied 24.6% and the S&P 500 has gained 15.1%.Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.
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