ARK Invest founder Cathie Wood has recently lowered her exposure to the AI semiconductor space, selling $4.5 million worth of shares in Nvidia and trimming her holding in Taiwan Semiconductor Manufacturing Co., which produces the Nvidia chips. Wood expects Nvidia competitors will soon start to pressure margins at the company, stating that the expectation levels are so high that they cannot be met.
Key takeaways:
- Nvidia crossed the $2 trillion market cap threshold, with Wedbush Securities' Dan Ives predicting a promising future for AI stocks.
- Apollo Global Management, led by billionaire Marc Rowan, warned that valuations have surpassed the excesses of the dotcom era, with the top 10 companies in the S&P 500 today being more overvalued than during the tech bubble in the mid-1990s.
- Nvidia's business is driven by high demand for its data center chips that power advanced AI, with Microsoft and Tesla also showing interest in the sector.
- ARK Invest founder Cathie Wood recently reduced her exposure to the AI semiconductor space, selling $4.5 million worth of shares in Nvidia, and expressing concerns that high expectations for Nvidia may not be met.