These 2 Billionaires Just Bought My Favorite Artificial Intelligence (AI) Stock
Wednesday, Dec 4, 2024 9:57 pm ET
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Two prominent billionaires, Ken Griffin of Citadel Advisors and David Shaw of D.E. Shaw & Co., recently added shares of Nvidia (NVDA) and Datadog (DDOG) to their portfolios. These purchases align with their investment strategies focusing on growth and innovation. Griffin's Citadel Advisors and Shaw's D.E. Shaw & Co. are known for their technology and growth-focused portfolios, with AI being a significant area of interest. By allocating capital to AI stocks like Nvidia and Datadog, these billionaires are positioning their portfolios to capitalize on the growing AI market, which is expected to reach $1.2 trillion by 2027 (UBS Global Wealth Management).
Nvidia, a leading AI chipmaker, has seen its stock price surge over 200% in the past year, driven by its dominance in AI chips and broad offerings. Amazon, a leader in AI through its AWS unit, has an annualized revenue run rate of over $105 billion. However, Super Micro Computer, a lesser-known player, faces potential risks due to a short report alleging troubles at the company and a possible Justice Department probe. While Nvidia and Amazon offer long-term growth potential, Super Micro Computer's stock may be volatile in the near term.
The timing of these billionaires' AI stock purchases reveals a mix of risk tolerance and investment horizon. David Shaw and Ken Griffin bought Nvidia in Q2 2024, when the stock had already surged 200% year-over-year, indicating a willingness to pay higher prices for a proven leader like Nvidia. However, Andreas Halvorsen of Viking Global Investors waited until Q2 2025 to buy Datadog, suggesting a more cautious approach, as the stock had cooled off from its peak. This strategy aligns with a longer-term investment horizon, as Halvorsen likely saw better value in Datadog after its initial hype.
These billionaires' AI investments compare to their other tech sector holdings, with Griffin's top tech sector holding being Amazon (AMZN) and Shaw's being Microsoft (MSFT). Their increased investments in Datadog suggest they see potential in the AI application layer, but their larger holdings in established tech giants indicate a preference for stable, diversified tech investments.
The billionaires' AI stock purchases reflect their views on the broader market trends and opportunities in the AI sector. Billionaires Andreas Halvorsen and Ken Griffin recently bought shares of Nvidia, a leading AI chipmaker. Their purchases reflect a bullish view on the AI sector, driven by the increasing demand for AI chips and the potential for AI to revolutionize industries. Halvorsen's 1.3 million shares and Griffin's 1.1 million shares signal confidence in Nvidia's growth prospects. Halvorsen's Viking Global and Griffin's Citadel are known for their long-term investment strategies, suggesting they expect the AI boom to continue. Their purchases also indicate a positive outlook on the broader market trends, with AI being a key driver of growth.
In conclusion, the purchases of AI stocks by billionaires Ken Griffin and David Shaw align with their investment strategies focusing on growth and innovation. The AI market is expected to reach $1.2 trillion by 2027, presenting significant opportunities for investors. While there are potential risks, Nvidia and Amazon offer long-term growth potential, and Super Micro Computer's stock may be volatile in the near term. The timing of these purchases reveals a mix of risk tolerance and investment horizon, and the billionaires' AI investments compare to their other tech sector holdings. The billionaires' AI stock purchases reflect their views on the broader market trends and opportunities in the AI sector, indicating confidence in the AI boom and its potential to drive growth.