KUALA LUMPUR, Nov 5 (Bernama) -- Bursa Malaysia closed higher, buoyed by Bank Negara Malaysia’s (BNM) decision to maintain the Overnight Policy Rate (OPR) at 2.75 per cent, alongside positive cues from Wall Street. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 19.30 points, or 1.19 per cent, to 1,635.86 from Wednesday’s close of 1,616.56. The benchmark index opened 6.72 points higher at 1,623.28, and fluctuated between an intraday high of 1,642.44 and a low of 1,622.62 during the trading session. However, market breadth was negative, with losers outnumbering gainers 723 to 497, while 466 counters were unchanged, 1,075 untraded and 10 suspended. Turnover rose to 3.74 billion units valued at RM3.61 billion compared with yesterday’s 2.81 billion units valued at RM2.57 billion.
As Nvidia (NVDA.US) gears up to report FY26 Q2 earnings after the bell on Wednesday, August 27, the options market is showing unusual calm compared to past quarters — a signal that traders are pulling back from aggressive bets amid a cooling volatility landscape.
Implied Volatility and Expected Move Dip Below Average
Implied Move: The options market is pricing in a ±7.01% post-earnings move, below the 12-quarter average of 8%.
Implied Volatility (IV): Currently sits at 48%, ranking only in the 39th percentile over the past year — a clear sign that expectations for big earnings-day swings are fading.
Put Skew: Remains flat near zero, meaning no elevated pricing for downside protection — a sharp contrast to the usual cautious buildup ahead of earnings.
Interpretation: Market sentiment is leaning toward stability or neutrality, lacking signs of large speculative positioning.
Option Open Interest Trends at 1-Year Lows
Total Open Interest for options expiring Aug 29 has fallen to a 12-month low, further reinforcing a lack of speculative buildup.
Put/Call Ratio stands at 0.80 — reflecting slightly more call open interest, but not significantly skewed.
Max Open Interest Levels:
Calls: Most open at $185 and $190
Puts: Concentrated around $150 and $160
Max Pain: Currently sits at $170, suggesting that’s the level where most option contracts expire worthless.
Conclusion: There’s a lack of directional conviction — both bulls and bears appear cautious, opting to sit on the sidelines or play defense.
Option Strategy Spotlight: Short Put for Income + Defensive Entry
With low volatility, selling premium becomes more attractive than buying it. Here’s a conservative approach for investors who remain long-term bullish on Nvidia but are hesitant to buy at current prices.
Short Put Strategy
Sell the $160–$170 strike put expiring Aug 29 or Sep 19
These strikes offer:
10–15% downside buffer
Liquid contracts with high open interest
A chance to collect income while potentially buying NVDA at a discount
Why It Works:
Low IV suppresses long option premiums — reducing upside potential from buying calls or straddles.
This strategy allows you to earn premium while waiting for a better entry point.
Works best for those who are comfortable owning NVDA if the stock dips.
Market Implication
The absence of strong directional plays or defensive hedging suggests that the options market is betting on stability, even as Nvidia remains at the heart of the AI infrastructure rally. Investors are watching for updates on GB200 shipments and early outlook for GB300, which could reignite momentum — or disappoint lofty expectations.
Until then, premium-selling strategies like short puts may offer the best way to play this earnings season.
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