Amid the recent volatility in Nvidia’s (NASDAQ: NVDA) stock, several leading global investment funds have liquidated their positions in the semiconductor giant.
According to filings on August 14 with the Securities and Exchange Commission (SEC), notable investment firms, including Stanley Druckenmiller’s Duquesne Family Office, David Tepper’s Appaloosa Management, and Lee Ainslie’s Maverick Capital, all reduced their stakes in Nvidia during the second quarter of 2024.
For example, Druckenmiller’s family office significantly reduced its position in the technology giant during this period. It’s worth noting that Druckenmiller’s $4.4 billion family office first invested in Nvidia shares in the fourth quarter of 2022 before the equity began a significant bull run.
Tepper’s Appaloosa Management notably offloaded its stake in the chipmaker by 84%. The investment firm acquired Nvidia shares in the first quarter of 2023 and significantly increased its stake in the second quarter of that year before the recent sale.
Meanwhile, under Ainslie, Maverick Capital trimmed its Nvidia holdings by 2.86% after initially acquiring nearly 464,000 shares in the first quarter of 2023.
Lack of confidence in Nvidia?
Indeed, the highlighted investment firms are not the first to trim their stakes significantly in artificial intelligence (AI) stock. For example, in the last quarter of 2023, the Bill & Melinda Gates Foundation completely divested its Nvidia shares. At the same time, Chase Coleman III’s Tiger Global Management also decreased its substantial stake in the company during the final quarter of last year.
These sales possibly indicate a lack of confidence in Nvidia’s immediate future, with NVDA having rallied almost 600% since 2023. This concern is bolstered by the fact that the semiconductor firm’s insiders, led by CEO Jensen Huang, have been on a selling spree.
For instance, one recent transaction saw Huang sell over $24 million of his NVDA stake in sales on August 8 and 9, with prices per share ranging from $97.8019 to $106.2871.
NVDA building momentum
In the meantime, Nvidia is again building momentum after recent losses that saw the equity plunge below the $100 support level. Currently, the share price targets reclaiming the $120 resistance, which is crucial for further gains.
At the moment, NVDA is trading at $117, having rallied over 1% in the past 24 hours, while on the weekly chart, the stock is up over 13%.
Nvidia one-week stock price chart. Source: Finbold
Indeed, investors are looking forward to the upcoming Nvidia Q2 2024 earnings report, which is expected on August 28. Analysts estimate that the company will likely have a solid quarter, especially since the results are expected to demonstrate how AI chip clients are generating revenue.
However, NVDA remains susceptible to overarching fears regarding the trajectory of the United States economy, especially with indicators of a possible recession.
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