Investment Review №344. A Commitment to Techno-Optimism

Trade Thesis

An aggressive bet on continued upside in Nebius over the next 8 weeks via a $175-strike call option. Nebius remains one of the strongest stories in AI infrastructure: demand is confirmed by major contracts, its expansion program is funded with Nvidia backing, and a high short interest creates the potential for additional momentum if the positive backdrop holds.

Key Arguments

• Strong AI infrastructure backdrop and confirmed demand. In late March, Nebius announced the construction of a 310 MW AI data center in Finland — a signal of real capacity build-out to meet future demand.
• Major financing and Nvidia backing accelerate the expansion story. Nebius closed a $4.34B convertible debt raise and Nvidia invested $2B in the company — a powerful signal of confidence in Nebius as a key infrastructure player in the AI chain.
• High short interest creates additional upside potential. Short float ~20.88%, short ratio ~2.7 — not a standalone bullish argument, but if the positive backdrop continues, short covering could meaningfully amplify the move higher.

Risk Managment

If NBIS closes above $175 but below $198.80 at expiration on 06/18/2026, the investor will realize a partial loss depending on the final stock price. If the stock closes below $175, the maximum loss equals the premium paid — $2,380. If the stock closes above the breakeven of $198.80, the position becomes profitable. The base case is to hold until the target premium of $40.70 is reached. Key risks: a correction in AI sentiment or disappointing capacity expansion news; a heavy capex profile and dependence on continued access to capital markets; and time decay working against the position if the stock moves sideways or weakens before expiration.

Trade Parameters

P/L of the Option Strategy