Spacex Put Options Too Expensive - Jun 17

The Big Picture

Intel has begun production of its advanced 18A-P chip node, a notable step in its process roadmap, while Michael Burry says SpaceX put options are too expensive, suggesting options markets are pricing in sizable event risk. These twin developments matter for investors because one affects semiconductor supply capacity and the other highlights potential distortions in options pricing that can affect portfolio hedges and speculative positions.

Markets were mixed in the midday session, with the Dow higher and the S&P 500 and Nasdaq lower according to the midday roundup. You should pay attention to both operational execution at chipmakers and how options markets are valuing risk, because each can change sector and portfolio exposures quickly.

What's Happening

Here are the specific developments and why they matter to investors.

• Intel has begun production of the 18A-P chip node, marking a progression in its advanced-node manufacturing roadmap. Investors track these milestones to assess future capacity and competitiveness in semiconductor fabrication.
• Michael Burry publicly said SpaceX put options are too expensive. That comment focuses attention on options-implied pricing and potential mispricing of downside protection tied to high-profile companies or events.
• Key numerical data points available for valuation analysis include 296.69%, 99.17%, and 0.77%, which market participants can use when testing scenario returns, implied volatility levels, or relative valuation spreads.
• The broader market was mixed midday, with the Dow up while the S&P 500 and Nasdaq were down in the session's roundup, underscoring sector-specific drivers rather than broad market moves.

Each fact has investor implications. Intel's production start can influence capital expenditure expectations and competitor timelines. Burry's options commentary shines a light on how protection costs and implied volatility might be affecting trading and hedging costs.

Why It Matters For Your Portfolio

Operational milestones and shifts in options pricing cut across investment styles. For growth investors, Intel's 18A-P production signals potential for future performance on higher-efficiency nodes. For traders and volatility-focused investors, comments about expensive SpaceX put options suggest the market may be charging high premiums for downside protection, which affects hedging costs and trade selection.

There was no analyst sentiment directly cited in the midday roundup. Analysts and portfolio managers will likely watch early production indicators and options-implied metrics to reassess risk-reward across semiconductor and aerospace-adjacent exposure.

Risks To Consider

• Execution risk at Intel: early production does not guarantee yield, ramp speed, or economics. Delays or subpar yields could push out expected benefits for the company and its customers.
• Options mispricing and volatility spikes: if put options are overpriced, hedging becomes costly and speculative bets can amplify losses when implied volatility adjusts downward rapidly.
• Concentration and headline risk: both semiconductor production milestones and high-profile statements about options pricing can drive short-term volatility in sector or company stocks, which could hurt undiversified positions.

What To Watch Next

Focus on near-term indicators that will confirm whether these developments change fundamentals or just create trading noise.

• Intel production updates and yield disclosures, which will clarify whether 18A-P is progressing at scale.
• Options-implied volatility and premium levels for SpaceX-linked instruments or comparable names, to see if Burry's view is reflected in market pricing.
• Company-level announcements, supplier commentary, and order trends for semiconductors that could validate the practical impact of the 18A-P start.
• Macro and sector flows that explain the midday divergence where the Dow was up while the S&P 500 and Nasdaq were down.

The Bottom Line

• Intel's start of 18A-P production is a milestone to monitor for longer-term capacity and competitiveness, but investors need yield and ramp data to assess real impact.
• Michael Burry's comment that SpaceX put options are too expensive highlights the need to check implied volatility and hedging costs before using options as protection.
• Use the provided numerical data points, including 296.69%, 99.17%, and 0.77%, as inputs when stress testing valuations and scenario returns.
• If you hold semiconductor exposure, watch production and yield updates. If you use options for hedging, verify implied premium levels and liquidity before executing trades.

FAQ

Q: Are these developments reasons to change semiconductor exposure?

A: Intel's 18A-P production start is an operational positive, but you should wait for yield and ramp data before altering allocations based on this single milestone.

Q: What does Burry's comment mean for options traders?

A: The comment suggests some put options may carry high premiums, increasing hedging costs and affecting the attractiveness of buying protection versus using alternative strategies.

Q: How should I use the numeric data points in valuation work?

A: Treat the numbers such as 296.69%, 99.17%, and 0.77% as scenario inputs for stress tests or implied-return calculations. They can help you compare tail scenarios and options-implied outcomes for risk management.