For five consecutive quarters, Nvidia has been selling off, and "Wood Sister" Kathy Wood has stated that she will continue to cash out.
On February 26th Eastern Time, Casey Wood, a fund manager at Ark Investment Management, talked on social media platform X about why NVDA was being sold. "In 2014, most investors still regarded Nvidia as a PC gaming chip company, so we chose to buy it for $5. Now, Nvidia's earnings have exceeded 150 times, and we choose to take profits."
According to 13F data, in the fourth quarter of 2023, Ark Invest held 148000 shares of NVIDIA, a decrease of 34.13% from the end of the third quarter, with a market value of $73.33 million, accounting for 0.44% of total assets. It is reported that Mu Jie has been selling Nvidia for five consecutive quarters.
In the third quarter of 2022, Ark Invest significantly increased its holdings in NVIDIA, holding 1.3826 million shares; In the fourth quarter of 2022, more than half of the positions were cut, leaving 523200 shares held; Throughout 2023, Ark Invest has been reducing its exposure to Nvidia, with holdings of 414300 shares, 295700 shares, 224800 shares, and 148000 shares in the four quarters.
From 1.3826 million shares in the third quarter of 2022 to 148000 shares in the fourth quarter of 2023, Ark Invest has sold nearly 90% of NVIDIA shares within five quarters.
After hours on February 22nd Eastern Time, Nvidia released a performance report that exceeded expectations. However, this did not hinder Mu Jie's selling footsteps. According to documents disclosed on February 26th, ARKG sold 2724 shares of NVIDIA shares, while ARKQ sold 2362 shares.
According to Ark's official website, on February 27th, among the eight ETFs managed by Cathie Wood, Nvidia only appeared in the top fifty heavy holdings of four products. ARKW holds 21200 shares with a market value of 16.7667 million US dollars, ranking 28th in market value; ARKG holds 20600 shares with a market value of 16.2597 million US dollars, ranking 32nd in market value; ARKQ holds 29000 shares with a market value of 22.9841 million US dollars, ranking 11th in market value; ARKF holds 16700 shares with a market value of 13.2186 million shares, ranking 24th in market value.
Ark's significant sell-off of Nvidia took advantage of Nvidia's strong upward trend and made Ark's performance generally poor since the beginning of the year. Since the beginning of the year, the net value of ARKK, the largest ETF, has fallen by 13.29%. In addition, the net value of ARKQ has fallen by 9.13% and ARKF has fallen by 7.31%.
Nvidia is the current popular Crispy fried chicken and the leader of this round of AI wave. Since the beginning of the year, Nvidia's share price has risen by 59.71%. Why did Kathy Wood go against the trend and repeatedly lower her position? Taking into account Kathy Wood's perspectives from various channels, it can be summarized as two aspects: Nvidia faces intensified competition and inventory adjustment challenges, and intelligent software is superior to intelligent hardware.
Kathy Wood has repeatedly praised Nvidia as a leader in the AI field and stated that she has been following Nvidia since its listing. But Casey Wood believes that technology giants such as Meta and Amazon are also developing AI chips, and Nvidia's competitive pressure will continue to increase, and demand may slow down. In addition, Cathy Wood believes that Nvidia may face inventory challenges. "Taking 2017 as an example, the rise of the cryptocurrency industry led to a surge in demand for Nvidia GPUs, which at one point led to excessive market demand. Market participants were eager to purchase GPUs, resulting in multiple orders exceeding normal demand, ultimately leading to inventory buildup. Whenever I hear about double, triple, or quadruple orders to cope with shortages, I always stay away."
In addition, Kathy Wood stated in her 2023 interim report that the increase in demand for artificial intelligence hardware indicates a significant increase in software revenue. She estimates that by 2030, for every $1 spent on artificial intelligence hardware, software may generate up to $8 in revenue. Under this judgment, she placed more positions in niche software companies such as UiPath and Twilio.
However, many institutions have expressed doubts about Sister Mu's operation. According to data from Morningstar, in the past four years, ARKK funds have either ranked among the top or absolutely bottom among similar funds. The fund's 5-year annualized return rate is 2.8%, lagging behind almost all medium-sized growth and technology funds. At present, Morning Star still ranks ARKK as a "one star fund" (out of five stars).