--- title: "'Big Short' Legend Eisman Is 'Nervous About The Sustainability' Of Nvidia's Melt-Up" type: "News" locale: "en" url: "https://longbridge.com/en/news/286785509.md" description: "Investor Steve Eisman expresses concern over the sustainability of Nvidia's rally, noting its size compared to the S&P 500 healthcare sector. He highlights a shift in the S&P 500's composition, with defensive sectors declining. Eisman is cautious about rising wholesale inflation and its impact on equity markets, particularly as the 10-year yield approaches 4.5%. Despite his concerns, retail traders remain optimistic, heavily buying calls on major tech stocks, while Polymarket traders see low chances of a downturn." datetime: "2026-05-18T13:58:42.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/286785509.md) - [en](https://longbridge.com/en/news/286785509.md) - [zh-HK](https://longbridge.com/zh-HK/news/286785509.md) --- # 'Big Short' Legend Eisman Is 'Nervous About The Sustainability' Of Nvidia's Melt-Up **Steve Eisman**, the investor made famous by Michael Lewis’s “The Big Short,” said this week he is trimming his portfolio because the rally is starting to feel bubbly. Eisman flagged that **Nvidia** (NASDAQ:NVDA) is now larger than the entire S&P 500 healthcare sector, a sign of how concentrated the rally has become. ## Defensive Sectors Are Vanishing On his weekly podcast, Eisman said the S&P 500 has quietly shed its defensive ballast during the rally. The combined weight of healthcare, consumer staples, energy and utilities has fallen to 19% of the index, down from 31% at the end of 2022. In their place, the chip complex has taken over, semiconductors have ballooned to over 18% of the index from 14% at the start of 2026, and **Micron Technology** (NASDAQ:MU) has cracked the top 10 alongside Nvidia. That sector rotation has powered a sharp round-trip. The S&P was down 4% on the year at its March bottom and is now up 9%, with the Nasdaq up 15%. “I am nervous about the sustainability of this meltup,” Eisman said, adding that he lightened up on his high-flyers this week. ## Inflation And The 4.5% Rubicon Eisman’s bigger worry sits in the plumbing. Wholesale inflation re-accelerated last month, with PPI jumping 1.4% versus the 0.5% consensus and pushing the annualized rate to 6%, the highest reading since December 2022. That has dragged the 10-year yield back toward 4.5%, a level Eisman described as a structural “Rubicon” for equity markets. He also questioned the market’s assumption that the U.S.-Iran war is over, noting Trump rejected Tehran’s latest peace proposal this week. ## Retail Is All-In On The Mag 10 CBOE data cited by Eisman showed retail traders are buying calls on the MAG 10 basket, which includes Nvidia, **Palantir** (NASDAQ:PLTR), **Advanced Micro Devices** (NASDAQ:AMD) and **Broadcom** (NASDAQ:AVGO), at the heaviest 10-day clip since 2021. Of new positions opened, 52% were call buying. ## Polymarket Traders Are Not Buying The Bear Case Polymarket’s “AI bubble burst” contract gives the industry a 23% chance of a downturn by Dec. 31, 2026, with $2.8 million in volume. One of the resolution triggers requires Nvidia to fall 50% from its all-time high. The “US recession by end of 2026” market is trading at 26% with $1.5 million in volume. While Eisman is treating 4.5% yields and hotter PPI as a cue to trim, Polymarket traders are still pricing in a continued bull market. _Image: Shutterstock_ ### Related Stocks - [.SPX.US](https://longbridge.com/en/quote/.SPX.US.md) - [NVDA.US](https://longbridge.com/en/quote/NVDA.US.md) - [SMH.US](https://longbridge.com/en/quote/SMH.US.md) - [SPY.US](https://longbridge.com/en/quote/SPY.US.md) - [VOO.US](https://longbridge.com/en/quote/VOO.US.md) - [SOXX.US](https://longbridge.com/en/quote/SOXX.US.md) - [NVDX.US](https://longbridge.com/en/quote/NVDX.US.md) - [IVV.US](https://longbridge.com/en/quote/IVV.US.md) - [NVDY.US](https://longbridge.com/en/quote/NVDY.US.md) - [SOXL.US](https://longbridge.com/en/quote/SOXL.US.md) - [XLK.US](https://longbridge.com/en/quote/XLK.US.md) - [NVDL.US](https://longbridge.com/en/quote/NVDL.US.md) - [NVDU.US](https://longbridge.com/en/quote/NVDU.US.md) - [MU.US](https://longbridge.com/en/quote/MU.US.md) - [.IXIC.US](https://longbridge.com/en/quote/.IXIC.US.md) - [PLTR.US](https://longbridge.com/en/quote/PLTR.US.md) - [AMD.US](https://longbridge.com/en/quote/AMD.US.md) - [AVGO.US](https://longbridge.com/en/quote/AVGO.US.md) - [NVD.DE](https://longbridge.com/en/quote/NVD.DE.md) ## Related News & Research - [Nvidia’s AI Lead Is Back in Focus as Wolfe Research Doubles Down](https://longbridge.com/en/news/286680544.md) - [$100 Invested In GraniteShares 2x Long NVDA Daily ETF 5 Years Ago Would Be Worth This Much Today](https://longbridge.com/en/news/286320411.md) - [Nvidia Will Report Q1 Earnings on May 20 — Options Traders Expect an 8.65% Move in NVDA Stock](https://longbridge.com/en/news/286763191.md) - [Nvidia's $78 billion earnings test could reveal the real AI demand story](https://longbridge.com/en/news/286447895.md) - [Jensen Huang nears $200B as Nvidia tops $5.5T before China talks](https://longbridge.com/en/news/286370644.md)