If you’ve been looking to buy a new or used car lately, you know that supply is limited and demand is high in this market.
And one of the main reasons for that is a lack of semiconductor chips.
But it’s not just the car market… Really, anything that requires a semiconductor chip has seen shortages lately.
Congress is now working to pass a bill that would provide more than $50 billion in subsidies and tax credits to help build up the US chip industry and alleviate bottlenecks in the supply chain.
That all sounds great, but already the insiders in Washington DC are back to their funny business again…
The Ultimate Insiders
We don’t normally talk about politicians as corporate insiders.
But they are the ones that have their hands on our economy with the ability to affect more than one stock.
And just like corporate insiders, our politicians on both sides of the aisle are required to file with the SEC within days of making their trades.
That $50 billion must have been music to the ears of Speaker of the House Nancy Pelosi’s husband, as he just reported a massive position in NVIDIA Corporation (NVDA) stock ahead of Congress voting on the bill.
According to the latest disclosure report released by Pelosi’s office, her husband exercised 200 call options on NVIDIA to buy 20,000 stock shares worth somewhere between $1 and $5 million in June.
The same report showed that Mr. Pelosi sold 10,000 shares of Visa Inc. (V) stock and 50 call options on Apple Inc. (AAPL).
The Wolf of Washington
Regular readers know that I like to call Pelosi “The Wolf of Washington.”
She is the ultimate Washington insider, and she and her financier husband have been making millions with stock options over the years.
Now, some reports have said that NVIDIA, which designs its own chips but doesn’t actually build them in-house, wouldn’t see much direct benefit from the bill.
However, there is another, separate bill that would provide tax incentives for companies that design chips as well.
When I look at the stock, I see a clear downward trend that has shaved 60% of the value from the stock in under a year.
While NVDA is about 15% off of its recent low, it has just come up to tap the underside of its 50-day moving average (red line).
This is generally a place where I would be looking to short the stock rather than buy it.
But I’m certainly not going to go against the insiders on this one.
It’s quite likely The Wolf of Washington knows something about these bills that we don’t…
Join the Insiders
Now, what’s interesting to me about this situation is not that a politician is making a killing in the market… That’s nothing new.
What’s interesting to me is that more individual investors aren’t following the lead of company insiders like corporate CEOs or Washington insiders like Nancy.
These folks have inside knowledge of their companies and the financial markets, so following their trades can lead to massive gains.
This is what we do at my Insider Effect research service every day, and it’s helped us rake in some great returns over the years.
So, if you’ve been looking for a better strategy to find winning stocks in a down market, consider checking out my special live presentation this afternoon.
It’s absolutely free to attend!
I look forward to seeing you there!
Embrace the surge,
Editor, Stock Surge Daily