According to a recent asset allocation analysis, a sizable segment of Tiger 21, a network of extremely wealthy investors and entrepreneurs, does not own any Nvidia stock. According to the second-quarter report, 57% of Tiger 21 members have decided not to do business with the massive semiconductor manufacturer, and many of them have stated that they have no plans to open an account with them.
The company’s shares dropped 9.5% overnight, erasing approximately $280 billion from its market capitalization. This decline has led 43% of Tiger 21 members to express skepticism about Nvidia’s long-term prospects, with many believing that its current success may not be sustainable over the next decade.
For those who have invested in Nvidia, there is a prevailing sentiment of hesitation to increase their holdings. Concerns about the stock’s high valuation and potential for increased competition in the technology sector are driving this cautious stance. Some members have chosen to avoid technology investments altogether, preferring to allocate their capital to real estate or other sectors.
The hesitation to invest in Nvidia reflects a broader trend among Tiger 21 members, who appear to prioritize wealth preservation over chasing high returns. This cautious approach contrasts with Nvidia’s recent meteoric rise, which saw the company’s market cap surge to $3 trillion earlier this year, fueled by the artificial intelligence (AI) boom.
Despite the current volatility, the AI sector remains a significant area of interest. Nvidia, once hailed as the world’s most important stock due to its pivotal role in AI technology, is experiencing a period of adjustment. The company’s dramatic growth has faced a slowdown, contributing to the recent dip in its stock price.
Tiger 21’s recent asset allocation report highlights that its members are diversifying their investments across various sectors. Private equity remains a major focus, accounting for 28% of their portfolios. Real estate also holds a substantial portion, comprising 26% of allocations despite high interest rates. Public equities make up 22% of their asset distribution.
As the technology landscape continues to evolve, Tiger 21 members are navigating the complexities of investing in a rapidly changing market. While Nvidia’s dominance in AI is acknowledged, the potential for increased competition and market recalibration is influencing investment decisions within this elite network.
Tiger 21, established in 1999, is known for its members’ collective focus on wealth preservation, investment strategies, and philanthropic endeavors. With combined personal assets exceeding $165 billion, the network’s members continue to share insights and strategies to manage their wealth effectively amidst market fluctuations.
