Nvidia’s credit default swap spreads have climbed to 69 basis points, officially surpassing Alphabet’s 64 basis points. In plain English: investors now view Nvidia as a marginally riskier bet to pay back its debts than Google’s parent company.
What CDS spreads actually tell us
Credit default swaps are essentially insurance policies against a company defaulting on its debt. The higher the spread, the more investors are paying for that protection, and the more nervous they are about the borrower’s ability to pay up.
Nvidia’s CDS spreads have been on a steady climb, rising from roughly 42 basis points in late June to approximately 57 basis points by mid-July. Alphabet’s spreads, meanwhile, have floated in a range of roughly 29 to 49 basis points during the same period.
Oracle’s CDS spreads have surged to multi-year highs above 75 basis points. Even previously rock-solid names like Amazon, Microsoft, and Meta have seen their spreads drift upward.
