Billionaire Investor Stanley Druckenmiller’s Costly Mistake: Selling Out of Nvidia
Stanley Druckenmiller, a renowned billionaire investor, recently shared a painful lesson from his investment career. In a candid interview with Bloomberg, Druckenmiller revealed that selling his entire stake in Nvidia earlier this year was a “big mistake.”
A Misstep in the AI Boom
Nvidia has been the primary beneficiary of the artificial intelligence boom, with its graphics processing units (GPUs) in high demand from top cloud companies and large language model developers. The stock has seen phenomenal growth, soaring 239% last year and another 174% in 2024, reaching a fresh record high on Monday.
Druckenmiller’s Regret
Druckenmiller sold his Nvidia shares between $800 and $950, which, adjusted for the company’s 10-for-1 stock split, translates to between $80 and $95. If he had held onto his entire stake, it would now be worth around $1.19 billion. “I own none and I owned none the last 400 points,” Druckenmiller lamented.
A Valuation Concern
Druckenmiller explained that he cut his Duquesne Family Office’s position in Nvidia due to concerns about the company’s rich valuation. “It tripled in a year, and I thought the valuation was rich,” he said. While he believes Nvidia is a wonderful company, he’s currently “licking my wounds from a bad sale.”
A Lesson Learned
Druckenmiller’s experience serves as a reminder that even seasoned investors can make costly mistakes. As he looks to the future, he’s open to revisiting Nvidia if the price comes down. “Were the price to come down, we’d get involved again,” he said.
What’s Next for Nvidia?
Nvidia is expected to release its quarterly results in November, while its top customers, including Meta, Microsoft, and Alphabet, will report their financials later this month. As the AI boom continues to shape the tech landscape, investors will be watching closely to see how Nvidia performs in the coming months.
Leave a Reply