To The Moon

Big-Tech’s Performance

This week spanned the first trading day of 2025 at the year-end level of 2024, and the overall market sentiment also showed a rhythm of ups and downs, on the one hand, it is the closing of 2024 after a big rise, on the other hand, there is also a risk aversion to the next oscillating trend, and a lot of investors are also grabbing the opportunity to run away.

The market also began to diverge in the opening two days of 2025, and the performance among big tech companies presented market expectations.

By the close of trading on January 2, Big Tech companies as a whole closed lower over the past week.Among them were $Apple(AAPL)$ -5.56%, $NVIDIA(NVDA)$ -1.36%, $Microsoft(MSFT)$ -4.72%, $Amazon.com(AMZN)$ -3.86%, $Alphabet(GOOG)$ $Alphabet(GOOGL)$ -3.41%, $Meta Platforms, Inc.(META)$ -1.40% and $Tesla Motors(TSLA)$ -17.95%.

Big-Tech’s Key Strategy

Nvidia's Glorious 2024, and Highly Anticipated 2025

In stark contrast to the pullbacks in Apple and Tesla, Nvidia shares held firm on the first trading day of the new year.Since pulling back more than 7% from its highs, NVDA still hasn't triggered a new sell signal on the technical front.

The key word in 2024 is undoubtedly AI, Nvidia is the earliest company to benefit from the AI introductory era, with excellent performance, the company's market capitalization reached $ 3 trillion (only three), and successfully split the stock in the middle of the year, the end of the year to replace the old INTC into the Dow.Although the end of the year there are peers of Broadcom because of its ASIC chip "another way" mouth dry, but the flexibility of the GPU is to make it able to deal with different workloads, may be a more cost-effective option.

According to Morgan Stanley's Joseph Moore, some customers have said in conversations that some of the biggest ASIC users are actually moving back to GPUs.

One thing is critical for NVDA in 2025:

1. The main keyword: Blackwell. One of the market's biggest concerns about NVDA has been Blackwell's production, both in terms of capacity and yields.Since the current expectations for Hopper, an older chip family, are for a "gradual slowdown," this is actually good news for Blackwell, as the reduction in H200s will allow more back-end capacity and HBM3e supply to be effectively used for the Blackwell family;

2. Phase 3 AI revolution. 2025 could see a new shift in the AI revolution, away from building infrastructure and towards adoption and diffusion through software and services. nvidia's real moat is not just chip performance, but its NVLink software and CUDA ecosystem, which is the hardest to outperform, and just increasing the arithmetic density of its chips isn't nvidia's biggest moat.Nvidia's software expertise gives it the upper hand over competitors that don't build the software needed for enterprise use of AI chips and instead rely on other vendors.

3. High margin advantage.Software companies' current large capital expenditures could begin to have an impact on the income statement in 2025.Nvidia's high margins, on the other hand, will make it more favorable than other tech companies in a potentially high interest rate environment.

4. Smart hardware and robotics .Thanks to its powerful computing power, Nvidia has accumulated rich parallel computing technology in AI chip development, which is crucial for motion control and real-time environment recognition of robots. The newly launched Jetson Thor chip, which is designed for humanoid robots, is able to provide highly efficient computational support, and can also be used to provide a development environment ranging from hardware to software, to ensure that all the robot development requiredelements needed for robot development are available in a one-stop shop.

The looming event is CES on January 6, and investors are looking forward to it with much anticipation, believing that Nvidia is expected to make major announcements and showcase its advancements in various technologies

1. Jen-Hsun Huang (Jensen) will be delivering a keynote address on January 6, where he will likely discuss Nvidia's vision and innovations, especially in AI and robotics.

2. The highly anticipated GeForce RTX 5000 series of graphics cards could be released, with the RTX 5090 expected to be the flagship model and set the tone for its strategic direction in AI and gaming technology;

3. Nvidia will emphasize how its technology supports advances in robotics and autonomous systems, with the company positioning itself as a leader in "physical AI.

Meanwhile, AMD plans to show off its new Radeon products earlier in the day, so look for any surprises.Overall, though, Nvidia's revenues will grow faster than $Broadcom's (AVGO)$ or $American SuperMicro's (AMD)$ next year.

Options Observer - Big Tech Options Strategy

This week we're watching: Apple’s support

For Apple, the end of the year absorbed a lot of money slowing the bull into a shipping period.Without much change in fundamentals and with most of the projects in hand being bright cards, investors are likely to trade at the pace of AAPL's progress on the AI front, so 2025 is also a year where the shocks will intensify.As one of the largest weights, AAPL's volatility also affects the broader capitalization.

Among the open options in the latter weeks of January, AAPL has a larger position in the 200Call, which is not actively traded, and due to the higher in-the-money value, it is a positive stock pincushion, but instead is prone to be sold off under a big down win, and in fact the Put/Call ratio will be a bit higher.And for now, the former high of 260 is quite a resistance now.

Big-Tech Portfolio

The Magnificent Seven form a portfolio (the "TANMAMG" portfolio) that is equally weighted and reweighted quarterly.The backtest results are far outperforming the $.SPX(.SPX)$ since 2015, with a total return of 2,459.70% and a $SPDR S&P 500 ETF Trust(SPY)$ return of 238.86% over the same period, for an excess return of 2,220.84%.

The big tech stocks had a pullback this week, but year-to-date returns are still there to 61.82%, outperforming the SPY by 24.89%, with a record high excess return of 41.45%.

The portfolio's Sharpe Ratio over the past year has rebounded to 2.54, the SPY is 1.64 and the portfolio's Information Ratio is 2.19.