U.S. Nvidia (NVDA) announced a $5 billion (about 6.93 trillion won) investment in Intel (INTC), sending Intel shares soaring. Intel shareholders cheered, but an exchange-traded product (ETP) that inversely tracks three times Intel's daily gains was pushed to the brink of delisting three days after listing.
On the 19th, according to the London Stock Exchange in the United Kingdom, the price of the "LS -3x Short Intel ETP" closed overnight at $4.26. In a single day, the price plunged 75.86% (13.38%).
This product, listed on the 16th by Leverage Shares, Europe's largest leveraged ETP manager, tracks three times Intel's daily decline. As Intel ended overnight up 22.77% ($5.67) at $30.57, the net asset value (NAV) of the LS -3x Short Intel ETP slumped.
In particular, as Intel's pre-market gain before regular hours surged to as high as 34.25%, the LS -3x Short Intel ETP's NAV was even shown as "0." It narrowly survived a delisting threat just three days after listing.
Intel's share spike was thanks to Nvidia's investment announcement. Nvidia secured more than a 4% equity stake in Intel, becoming a major shareholder, and the two will jointly develop next-generation chips. By combining Nvidia's graphics processing unit (GPU) with Intel's custom central processing unit (CPU), they are expected to boost data processing speeds and target the AI server market.
U.S. Wedbush Securities said the investment would turn Intel from a laggard into a catalyst for change.
Moon Jun-ho, a Samsung Securities analyst, projected that both companies could strengthen their market dominance. Moon said, "Nvidia can expand its exposure to the PC market by being mounted on Intel chips, which hold the No. 1 share in the PC market, and Intel can design CPUs to be paired with Nvidia GPUs, helping defend its server processor share and gain indirect exposure to the AI market."
In investing circles, there was a joke that CEO Huang might once again create a delisted issue. That is because in January, after he said commercialization of quantum computers could take 15 to 30 years, an ETP that tracked three times the daily gains of quantum computing corporations IonQ (IONQ) was delisted.
Meanwhile, as Intel shares recovered the $30 level for the first time since August last year, investors' average paper returns also turned "plus (+)." Among 28,496 Intel stock investors linked to Naver Pay's "My assets" service, the average purchase price is about $29.6, with an average paper return of 3.3%. Still, more than half of investors remain in loss territory.