Renowned investor Stanley Druckenmiller has significantly reduced his stake in NVIDIA Corp NVDA, indicating a shift in his investment strategy.
What Happened: Druckenmiller’s Duquense Family Office sold off 441,551 shares of Nvidia in the first quarter, amounting to a 72% reduction in his holdings, according to a 13F filing with the Securities and Exchange Commission, reported Business Insider.
Despite the significant reduction, Nvidia remains the seventh-largest position in the portfolio, with a value of approximately $159 million.
Druckenmiller also liquidated all of his call options in Nvidia, which were acquired in the previous quarter for a total value of about $242 million. This move was likely another significant win, given Nvidia’s 82% surge in the first quarter to record highs.
Druckenmiller’s other significant trades include a $664 million investment in small-cap stocks through call options on the Russell 2000. This position is Duquense’s largest, followed by its holdings in Microsoft Corp MSFT valued at $468 million and South Korean e-commerce firm Coupang Inc CPNG, worth approximately $400 million.
Another notable trade was Druckenmiller’s near-tripling of his position in copper miner Freeport McMoRan FCX, now valued at about $65 million. This could indicate a bullish outlook on the broader U.S. economy.
Why It Matters: Druckenmiller’s decision to reduce his Nvidia stake comes at a time when the company’s future is being questioned. A recent warning from an analyst suggests that Nvidia’s stock might not be able to sustain its recent rise due to a potential decline in demand for its GPUs.
Druckenmiller’s move also follows a similar decision by his former boss, George Soros, who sold a large portion of his Nvidia stake, citing the AI revolution as having progressed too rapidly.
Despite these concerns, Nvidia’s stock has been on a roller-coaster ride in 2024, experiencing a 96% bull rally in the first quarter.
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