Known as the "Congressional Stock Market God", former US Speaker of the House Pelosi has recently been active in trading. According to the trading records of members of Congress, Pelosi bought call options and 10,000 shares of Nvidia stock, and sold some Tesla and Visa stocks.
Accurately catching the AI boom, buying Nvidia is a big win and a special win.
According to the records, on June 24, Pelosi purchased 20 call options from Broadcom with an exercise price of $800 and a maturity date of June 20, 2025. The total value of this transaction is estimated to be between $1,000,001 and $5,000,000. Two days later on the 26th, Pelosi made another significant investment, buying 10,000 shares of Nvidia. This transaction is similar to the purchase of Broadcom and is valued at between $1,000,001 and $5,000,000.
Nvidia and Broadcom have both experienced significant growth this year, with stock prices rising by 154% and 52%, respectively, mainly due to the surge in spending related to AI.
In particular, Pelosi's purchase of Nvidia is noteworthy because of her long and notable history of trading with the company. At the end of 2023, she conducted a very successful options trading with Nvidia. As early as the beginning of 2024, her investment returns from Nvidia were reported to have exceeded her annual salary as a member of Congress.
Analysis shows that if Nvidia continues to perform well in the second half of the year, even if the increase is only half of that in the first half of the year, Pelosi's new purchase of 10,000 shares will bring her about $1 million in profits, which is more than five times her annual salary.
As for the call options of Broadcom, which have an exercise price of $800, they also have a great potential for upward movement, as Wall Street generally believes that the company's stock will rise by at least 11% in the next 12 months.
Sell Tesla and lose money, but still earn big from Visa.
However, Pelosi's trading activities are not limited to buying stocks. On the same day she bought Broadcom call options, Pelosi sold 2,500 shares of Tesla stock. This sale is estimated to be worth between $250,001 and $500,000. Finally, on July 1, Pelosi partially sold her stocks in Visa, involving 2,000 shares and is estimated to be worth between $500,001 and $1,000,000.
Analysis suggests that Pelosi's sale of Tesla stock seems to have been ill-timed and the Tesla stock she sold on June 24th was likely purchased in March 2024. Given that Tesla's stock price has fallen from around $340 at that time to $182, Pelosi's Tesla has lost about $160 per share. Overall, the loss from this transaction is about $400,000. Moreover, just after she sold it, Tesla experienced a recent wave of rising prices, and the stock price has now risen to over $240 from that day, with a difference of almost $60, totaling about $150,000.
On the other hand, the sale of Visa stocks is incredibly profitable, as Visa's stock price on Wednesday was about $270, and according to reports, Pelosi bought these stocks for less than $30 in 2011. Among them, the sold Visa shares are listed as partially sold, which means that the couple still holds stocks in the credit card company. Also, the Pelosi couple participated in Visa's IPO and purchased 5,000 shares for $44 in 2008. At that time, this transaction was suspicious because the company's headquarters were located in Pelosi's home constituency.
To conceal her trading activities and catch the holiday season, the congressional trades have an ETF tracking.
Pelosi usually reports trades before the US stock market closes for the July 4th holiday. The X account Congresstrading, which closely monitors congressional trading, posted that Pelosi always chooses to report before the Independence Day holiday to avoid media attention, but this actually makes her more predictable.
Analysis suggests that Pelosi's trades are important because her husband Paul Pelosi is a venture capitalist who frequently makes large stock and options purchases. Although Pelosi has repeatedly stated that she has not shared stock tips or insider information with her husband, the timing of several trades has prompted questions from investors. These trades offer a glimpse into Pelosi's investment strategy and show her confidence in the tech industry. The long-term impact of these trades on her financial investment portfolio remains to be seen.
Given the interest of retail investors in congressional trading, especially the attention paid to Pelosi by the "Congressional Mountain Guru," Wall Street has launched several related theme ETFs, including series of investment portfolio trusts such as Unusual Whales Subversive Republican Trading ETF and Democratic Trading ETF, which track the trading activities of Republican and Democratic lawmakers, respectively.
In addition, Tuttle Capital has applied to the SEC to launch the Capital Congress Trading ETF, which will primarily invest in "stocks of companies publicly disclosed by current U.S. congressional members and/or their spouses in reports filed under the STOCK Act." The ETF is expected to be launched in August 2024. As for its operation, it will consider each congressional member's qualifications, participation in congressional committees, and records of generating excess returns to establish an initial investment portfolio. Thereafter, when a U.S. congressional member reports buying or selling a particular stock, the ETF will correspondingly buy or sell that stock.
The ETF is expected to be launched in August 2024. As for its operation, it will consider each congressional member's qualifications, participation in congressional committees, and records of generating excess returns to establish an initial investment portfolio. Thereafter, when a U.S. congressional member reports buying or selling a particular stock, the ETF will correspondingly buy or sell that stock.
Edited by Jeffrey