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Nvidia Controversy, Earnings May Propel These ETFs

BY | ETF Database
8:13 am ET 11/12/26 | 13 VIEWS
It’s been a bad stretch for shares of Nvidia Corporation NVDA. Over the past month, the semiconductor stock is off more than 27%. That period includes midterm election results viewed as hostile to data center construction plans and an investigation into now-former CEO Jensen Huang’s alleged marital misdeeds.Huang, one of the most visible CEOs in Corporate America, is out of a job following allegations that he had affairs with a Chinese national — allegedly a spy — and an Nvidia vice president. Salacious as those headlines are, the show must go on at the largest semiconductor company. And that includes Nvidia’s fiscal third-quarter earnings update due out on Nov. 17. Add it all up and the Direxion Daily NVDA Bull 2X ETF (NVDU A-) and the Direxion Daily NVDA Bear 1X ETF (NVDD A-) are the ETFs that may be perfect for risk-tolerant traders over the near term. The bullish NVDU attempts to deliver 200% of the daily performance of Nvidia shares. The bearish-though-not-leveraged NVDD seeks returns corresponding with the daily inverse performance of the tech stock.Nvidia ‘Burning Issues’ to ConsiderLeveraged and inverse ETFs such as NVDU and NVDD are event-driven plays. With Nvidia serving up daily doses of widely followed news, these funds are made for the moment. On the leadership transition front, the company is attempting to steady the ship by appointing CFO Colette Kress as interim CEO. As Morningstar’s Brian Colello pointed out, Kress and Ian Buck, who steers Nvidia’s AI plans, are the internal candidates who could succeed Huang on a permanent basis. Prediction markets also assign decent odds to Rene Haas, former Nvidia vice president and current CEO of ARM, being a credible external candidate. Huang’s successor isn’t the only issue for NVDD and NVDU traders to ponder.Potential 'Value Scenario'“The other burning issue will be the company’s views on data center development in the United States. In the very near term, we’ll be interested in whether the election has led to any immediate pauses in orders or concern about future demand,” added Colello. “Nvidia’s last forecast effectively called for $700 billion of AI revenue in calendar-year 2027. Longer-term, we’ll be interested in Nvidia’s insight into whether the US midterms will truly pause data center buildouts.” In what could be a sign that NVDD may continue its winning ways for a few more days, the Morningstar analyst said the firm has “a very high fair value uncertainty rating for Nvidia.” On the other hand, the drubbing endured by stock may be creating a value scenario. It could be one in which NVDU might deliver for short-term traders. “Shares appear undervalued to us. Nvidia’s stock has lagged this year as investment dollars flowed to other ‘picks and shovels’ AI components makers, such as memory chips and optical products,” concluded the Morningstar analyst. “Now that there are concerns about the AI buildout and the CEO role, Nvidia’s stock faces those headwinds too.” For more news, information, and analysis, visit the Leveraged & Inverse Content Hub.

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