The fund's analysis on Nvidia suggests that as long as the stock holds $340, it has the potential for another swing higher into year-end/early next year. However, they do not believe current prices are ideal for a long-term, buy and hold mindset. The fund plans to trim their position in Nvidia, citing the excessive level of insider selling by the CEO, Jensen Huang, as a cause for concern. The fund concludes that being patient will pay off for those looking to buy a great company at a great price. They also plan to discuss Nvidia and two other AI plays in their upcoming weekly premium webinars.
Key takeaways:
- The I/O Fund believes that the stock market is driven by sentiment rather than logic, and that tracking sentiment to protect capital requires a combination of fundamental and technical analysis.
- The fund has had a strong conviction in Nvidia’s AI story since November of 2018 and has a 45% AI allocation, exceeding Stanley Druckenmiller's 29%.
- The I/O Fund offers quality information at the free level through their newsletter and believes in transparency around position sizing, portfolio performance, and handling sell-offs.
- Despite Nvidia being a core holding, the fund plans to trim its position due to elevated insider selling and a belief that patience will pay off for those looking to buy a great company at a great price.