Retail Investors Now Buying Nasdaq Calls at Fastest Pace Since 2021 — Wall Street Split on Whether This Is 1999 or Just the Beginning

Retail traders are buying calls — aggressive bets that tech stocks will keep climbing fast.

According to Cboe exchange data reported by CNBC, retail traders are buying calls on the "Mag 10" — the original Magnificent Seven plus AMD, Palantir, and Broadcom — at the heaviest 10-day pace since 2021. Of new positions opened, 52% were call-buying. Only 17% were call-selling.

"Hedgers have thrown in the towel," said Mandy Xu, head of derivatives market intelligence at Cboe. "It's a consistent theme — people trying to catch up to the market rally through buying calls."

A Month Ago, Everyone Was Worried. Now Nobody Is.

Cboe's call-buying metric is 15 points higher than it was just four weeks ago, when investors were focused on geopolitics and oil prices.

The price of Nasdaq-100 call contracts one standard deviation out of the money just hit a 52-week high and is near a three-year record, per Nations Indexes' 30-day CallDex Index. Scott Nations, president of Nations Indexes, said: "The story is not just that Nasdaq-100 calls are pricey, but that nobody seems interested in selling covered calls. That signals a whole other level of bullishness."

The Nasdaq-100 set a new all-time record Monday. Year-to-date gain: more than 16%. Semiconductors are closing in on 20% of the S&P 500's total market cap.

Wells Fargo Just Doubled Down on Nvidia

Wells Fargo analyst Aaron Rakers raised his Nvidia price target from $265 to $315 on Tuesday — a call for 44% more upside from Monday's close. Rakers cited the company's Blackwell AI platform and the Groq 3 LPX rack-scale inference accelerator as key drivers.

"NVIDIA trading at under 20x P/E on what we view as durable 2027 consensus estimates should be bought," Rakers wrote.

Of 61 analysts covering Nvidia tracked by LSEG, 57 have a buy or strong buy rating. That's a crowded trade.

The AI infrastructure pipeline Wells Fargo is betting on is projected to exceed $1 trillion by 2027.

The 1999 Debate Is Real — and Both Sides Have a Point

The Philadelphia Semiconductor Index has only been this overbought relative to its 200-day moving average twice in history: early 2000, which marked a generational peak, and 1995, when semis dropped into a bear market even as broader indexes kept climbing.

Bespoke Investment Group noted Monday that since 1996, the only other time the S&P 500 hit record highs with fewer than 60% of stocks above their 50- and 200-day moving averages was late 1998 to early 2000.

Bank of America's tech equity trading desk pushed back, according to CNBC. BofA argues the bears are misreading the analogy. In the late '90s, it was the builders — telecom companies loading up on debt to lay fiber — who eventually blew up. The free-riders, the companies that benefited from all that infrastructure, were Amazon, Google, Meta, and Microsoft. "Interestingly, today's capex spenders ARE those same companies," BofA noted. They're not over-leveraged dreamers. They're the most profitable companies in human history.

Micron's fiscal 2027 profit projection has doubled in under three months, according to CNBC. That reflects earnings momentum, not pure speculation.

What the Right-Leaning Case Looks Like — and Why It Deserves a Hearing

This story was covered almost exclusively by center-left financial outlets — Bloomberg and CNBC. Conservative and right-leaning financial commentators have raised alternative arguments.

The right-leaning critique centers on policy: The Fed's decade-plus of easy money and the Biden-era stimulus overhang created the conditions for speculative excess. When rates stay near zero, you get meme stocks and options mania. That's a policy distortion, not a market.

Conservative analysts also flag the concentration risk. When semiconductors hit 20% of S&P 500 market cap, average Americans with 401(k)s are massively exposed to a single sector without knowing it. That's a systemic problem.

Fiscal conservatives point out that the AI infrastructure boom depends heavily on government subsidies through the CHIPS Act and favorable regulatory treatment — taxpayer-backed tailwinds that artificially inflate these valuations. If those subsidies disappear or get restructured, the math changes fast.

What This Means for Regular People

If you're a retail investor who just discovered options last month, the data shows you are now the most aggressive buyer of speculative contracts since the Covid stimulus era.

The rally in late 1998 was a great time to own tech stocks. The Nasdaq tripled between autumn 1998 and March 2000.

But it also ended badly.

The difference between a savvy call and a reckless one right now is whether you have an exit plan — or whether you're just chasing.