A recent asset allocation report from Tiger 21, a network of ultra-high-net-worth investors and entrepreneurs, revealed that more than half of its members are not invested in Nvidia. The report showed that 57% of the members have chosen to steer clear of the chip darling, with many citing concerns about the sustainability of the company’s growth. Despite Nvidia’s current position as the leader in AI, some members feel that no company’s growth lasts forever, and competitors often catch up, leading to a recalibration of the market.
Tiger 21 boasts over 1,450 members with personal assets collectively worth over $165 billion. The network, established in 1999 by Michael Sonnenfeldt, provides a platform for members to share advice on wealth preservation, investments, and philanthropic endeavors. With 123 groups in 53 markets, Tiger 21 covers a wide range of investment perspectives and strategies. Real estate takes up 26% of members’ portfolios, despite high interest rates, while public equities make up 22% of their asset allocation.
Of the 43% of members who have invested in Nvidia, most do not intend to increase their holdings, expressing concerns that the stock has already run up too high. These fears were validated when Nvidia’s stock plummeted 9.5% overnight, wiping out approximately $300 billion of its market cap amidst a broader market sell-off. Many members also voiced skepticism about Nvidia’s long-term success, with 43% predicting that the company’s growth will not last the next decade. Some members have opted to avoid technology investments altogether, choosing instead to focus on real estate or other sectors.
Michael Sonnenfeldt, the chairman of Tiger 21, emphasized that the club’s members prioritize wealth preservation over chasing high returns. While Nvidia has been lauded as ‘the world’s most important stock’ and experienced significant growth in the artificial intelligence sector, some members are wary of its volatility and the risks associated with tech investments. Despite its impressive performance in recent years, Tiger 21 members are cautious about the long-term sustainability of Nvidia’s success.
Despite concerns about individual tech stocks like Nvidia, Sonnenfeldt remains optimistic about the broader AI industry. He views the potential of AI as one of the most investible themes in financial history, highlighting the opportunities that the technology presents for investors. While some Tiger 21 members may choose to avoid specific tech investments, the overall sentiment towards AI remains positive among the ultra-high-net-worth network.
The investment landscape among Tiger 21 members reflects a diverse range of perspectives and strategies. While some opt to steer clear of popular tech stocks like Nvidia due to concerns about sustainability and competition, others remain optimistic about the potential of emerging technologies like AI. By prioritizing wealth preservation and strategic asset allocation, Tiger 21 members navigate the complexities of the investment landscape with a focus on long-term financial stability.
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