With AI continuing to garner interest, names like Nvidia and Taiwan Semiconductor Manufacturing are seeing stock purchases from the whales of the investment ocean. Those generally are billionaire fund managers.
As Motley Fool explained, these titans of industry are required to report their holdings by filing a Form 13F quarterly. A peek inside these 13F forms can give traders an idea of what the biggest fund managers are purchasing. Right now, it appears they can’t get enough of Nvidia and TSMC.
It’s easy to see why, given the three-year performances of both stocks. By far, Nvidia has been confounding markets with its extraordinary gains of over 600% within a three-year time frame. TSMC’s over 100% gain in the same three years might be paltry in comparison. But its bullish trend and growth potential can still attract investors.
From a fundamental perspective, the allure of both names are warranted. Tto run AI applications, computers — or on a bigger scale, data centers — require a heavy dosage of processing power. This is where Nvidia and TSMC come in. They provide the chips that can support these power-hungry AI capabilities.
According to Motley Fool story, billionaire fund managers are betting Nvidia and TSMC will continue to be the go-to chip providers as businesses and consumers both see increasing usage of AI platforms. Big tech names like Amazon and Google are bolstering their AI platforms. But they’ll need companies like Nvidia and TSMC to supply the chips.
Single-Stock Options for Margin of Safety
In investing vernacular, having a margin of safety is typically associated with value investment principles espoused by Benjamin Graham and Warren Buffett. It can also imply that having flexibility in the markets is better than having a naked position. That means being long or short without a proper hedge against risk. There are single-stock ETFs that can offer that flexibility if traders are interested in exposure to Nvidia or TSMC.
Traders who want to continue capitalizing on the bullish trend for Nvidia or TSMC can look at the Direxion Daily NVDA Bull 2X Shares (NVDU) and the Direxion Daily TSM Bull 2X Shares (TSMX).
On the opposite end of the spectrum, traders can take the bearish side with the Direxion Daily NVDA Bear 1X Shares (NVDD) and the Direxion Daily TSM Bear 1X Shares (TSMZ).
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