Artificial intelligence bulls are increasingly gravitating toward an ETF that amps up bets on Nvidia Corp. as trading volumes and inflows hit all-time highs.
After notching a record $252 million in fresh capital last week, the GraniteShares 2x Long NVDA Daily exchange-traded fund (ticker NVDL) saw its second-biggest trading volume on Monday as Wall Street’s AI darling extended its Friday retreat.
The fund, which gives investors two times the daily return of the underlying stock, has grown to $1.4 billion since launching at the end of 2022. NVDA has become a vehicle for investors big and small who are steadfast in their conviction that the Jensen Huang-led firm is riding profound technological shifts in the global economy that will create new wealth-generating opportunities in the stock market.
On Friday when Nvidia dropped nearly 6%, the fund clocked in record trading volumes, with over $2 billion worth of NVDL exchanging hands. Investors piled a net $102 million into the fund that day, likely betting on a short-term reversal in the semiconductor stock.
To Dave Lutz, head of ETFs at JonesTrading, “activity in NVDL is a key indicator of retail sentiment and activity,” given the size of the ETF’s trading volume. Meanwhile, short interest as a percentage of shares outstanding in the fund is low at just 1.5%, according to Markit Securities.
