just before the 22 per cent pop in share price – after owning it for years. But she fairly pointed out that her analyst Tasha Keeney picked up as far back as 2014 that Nvidia was far more than a bet on the growth of video gaming, and her Ark Innovation fund piled in at $US5 a share. The stock has been the fourth-biggest contributor to the fund’s performance.
In January 2022, amid a rout in tech stocks as long-term interest rates drifted higher, Munro’s Nick Griffin called out the stock as having “had the potential to be the largest company in the world”. As he pointed out, the stock is up 150 per cent this year alone and was trading on 50 times next year’s earnings. Not only that, it’s a stock that has the rare distinction of being too expensive for even Wood to own.But logic in owning Nvidia is predicated on an exponential take-up by data centres to add accelerated computing, which would require products such as the ones produced by the company.
That’s surprised some macro traders, given high-growth stocks have proved in recent times to be highly sensitive to interest rate movements.While the market appeared confident in January that we were past peak inflation and near peak interest rates, that has proved not to be the case. But all investors agree that any definitive sign that interest rates have peaked is the true signal to buy up stocks with confidence.