SK Hynix options debut puts AI memory trade in retail spotlight

SK Hynix options are set to begin trading Tuesday, giving retail investors a new way to bet on one of the key suppliers behind the AI buildout. The timing matters because individual traders have been pouring record amounts into options, especially in semiconductor names tied to artificial intelligence demand.

The South Korean memory-chip maker raised $26.5 billion in its US American depositary receipt offering on Friday, according to Bloomberg imagery cited by CNBC. An American depositary receipt, or ADR, is a US-listed security that represents shares of a foreign company, making it easier for US investors to trade that company’s stock.

Options add another layer. They are contracts that give buyers the right, but not the obligation, to buy or sell a stock at a set price by a set date. They can magnify gains and losses, which is why a new options chain on a high-profile AI supplier can quickly become a focus for active traders.

Retail options trading is already running hot

Retail traders bought and sold an average of $6.7 billion in options premium per day last month, according to a July 7 report from Citadel Securities. Options premium is the amount paid for those contracts. Citadel said that figure was more than 15% above the prior record set in May and 65% higher than last year’s average.

Semiconductors were the biggest retail options theme in that data, accounting for more than $1 billion in daily premium, Citadel Securities said. That helps explain why SK Hynix is arriving in a market already primed for another AI-linked chip trade.

SK Hynix is best known for memory chips, a category investors have connected to the AI infrastructure boom. Gav Blaxberg, founder and CEO of Wolf Financial, told CNBC that traders are focused on SK Hynix because Nvidia has signaled it will need steady memory supply. He said the market is seeing a demand super-cycle with only a small group of companies able to serve customers at that scale.

The AI supply-chain hunt is widening

Some retail investors are looking beyond the most visible AI companies and focusing on suppliers that could become tight spots in the system, including memory, power and other equipment. David Dziekanski, founder of Quantify Funds, described that group to CNBC as “the bottleneck bros.”

CNBC reported that some of that attention has been influenced by Leopold Aschenbrenner, a 24-year-old former OpenAI researcher whose stock picking helped build a hedge fund reported at $20 billion. Dziekanski compared his role among AI supply-chain traders to Bill Ackman’s following among some investors, saying traders want to know which AI-related area could draw attention next.

Investors are also using public disclosures and copy-trading apps to follow prominent portfolios, CNBC reported. Those filings include 13-F and 13-G forms, which disclose certain institutional holdings and ownership stakes. Apps such as Autopilot and Dub let users mirror trades or follow portfolios from popular investors, according to CNBC.

SK Hynix options may not be the only new vehicle competing for attention. Reuters reported last week that at least 10 exchange-traded fund issuers had filed registrations for single-stock ETFs tied to SK Hynix. A single-stock ETF is a fund designed to track one company, often with leverage that can amplify daily moves.

A Cboe spokesperson told CNBC the SK Hynix options were scheduled to start trading Tuesday and were still awaiting Options Clearing Corp. certification at the time of CNBC’s report.

This story draws on original reporting from CNBC.