Nvidia Stock Has Dropped 11% In November — Cathie Wood’s Ark Invest Can’t Let Go Of The Dip-Buying Opportunity
Synopsis
Fears of an AI bubble have intensified, pushing Nvidia stock down nearly 2% in Friday's premarket session.
- ARKK bought 93,374 million Nvidia stock on Thursday, valued at $16.9 million.
- The cumulative value of AMD shares Ark sold is $2.9 million.
- AMD is ARKK’s 10th-largest holding by value ($259.28 million), while Nvidia is way down, taking the 21st spot ($108.55 million).
Cathie Wood-run Ark Invest’s flagship fund, the Ark Innovation ETF (ARKK), resumed Nvidia buying, capitalizing on the stock’s dip. Nvidia’s stock ended Thursday’s session down over 3% in a dramatic turnaround from the 5% gain it notched at the day’s peak.
In the early premarket session on Friday, NVDA stock fell about 1%.
The stock has lost 11% since the start of November, when fears of an artificial intelligence (AI) bubble began to surface. The company enjoys a near-monopoly position in the market for high-performance computing chips that power most AI applications, processes, and services.
Ark Soops Up Nvidia
The ARKK exchange-traded fund (ETF) bought 93,374 million Nvidia stock, valued at $16.9 million, on Thursday following its post-earnings dip. According to Bloomberg, the fund’s previous purchase of Nvidia was on Aug. 4.
Wood has had a slightly bearish stance on Nvidia since it rallied strongly in 2023 amid the AI revolution. ARRK sold all of its Nvidia stake in January 2023 as Wood deemed it fit to invest in smaller AI names that were beginning to make a splash. The investor took flak for jumping the gun on Nvidia as the stock went about a record run, riding on the AI mania.
AI Chip Pair Trade
While Ark bought Nvidia, three of its ETFs trimmed their stakes in the company’s peer AMD. While ARKK sold 8,023 AMD shares, ARK Next Generation Internet ETF (ARKW) and ARK Fintech Innovation ETF (ARKF) divested 3,999 and 2,065 AMD shares, respectively.
The cumulative value of AMD shares Ark sold on Thursday is $2.9 million.
AMD is ARKK’s 10th-largest holding by value ($259.28 million), while Nvidia is way down, taking the 21st spot ($108.55 million).
For the year-to-date period, Nvidia has gained 35%, while AMD has gained 71%.
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