Bridgewater Associates, recognized as the largest hedge fund in the world, has significantly reduced its stake in Nvidia Corporation, trimming its holdings by an impressive 65.3% during the third quarter of 2025. This reduction, revealed in its recent 13F disclosure, saw the firm’s shares drop from 7.23 million to 2.51 million. This decision mirrors a growing sense of macroeconomic caution among institutional investors, as global markets recalibrate capital flows towards artificial intelligence (AI) infrastructure.
Concurrently, notable institutions, including SoftBank, have adjusted their portfolios, with SoftBank’s complete divestment from Nvidia generating $5.8 billion to finance emerging AI projects. This pivot reflects a broader trend of institutional investors reallocating their capital from traditional technology equities to firms poised to benefit from the expanding AI sector. For example, Bridgewater has shifted interests towards companies such as Applied Materials and Lam Research, highlighting a focused investment strategy on semiconductor equipment critical for AI advancements.
Despite these institutional sell-offs, Nvidia’s stock has demonstrated resilience, closing at $199.05 on November 10, 2025, and maintaining an impressive market value of $4.85 trillion. The chip industry leader experienced record-breaking revenue of $46.74 billion for fiscal Q2 2026, driven by strong demand for its AI accelerator products. Analysts remain bullish, reflecting a consensus of 64 “strong buy” recommendations and an average price target of $230.78, demonstrating continued faith in Nvidia’s role in AI computing.
The market’s sensitivity to large-scale asset liquidations was evident, as Nvidia’s stock experienced a slight dip to $196.05 on November 11. Such market movements underscore the delicate balance institutions maintain while adjusting their holdings in response to changing economic signals. The strategic asset sales by Bridgewater and SoftBank highlight a significant capital rotation toward the rapidly growing AI sector, indicating that major investors believe in the transformative potential of AI technology.
Nvidia’s continued prowess in the AI domain, complemented by a 34.23% stock increase over the last year, positions it as a frontrunner in the competitive landscape. Furthermore, the Alger Spectra Fund reported a 10.56% return in just one month, fueled by robust earnings momentum. However, some analysts caution that Nvidia’s current trailing P/E of 56.71 and forward P/E of 30.30 suggest high expectations, which could render the stock vulnerable to short-term volatility.
Additionally, the connection between traditional technology equities and AI-focused cryptocurrencies has gained attention. BitMine Immersion Technologies’ recent acquisition of 110,288 ETH illustrates rising institutional confidence in blockchain’s potential to support AI infrastructures. Despite Ethereum’s recent price fluctuation, the accumulation of tokenized asset holdings reinforces its significance as a foundational element for AI-enhanced financial solutions.
As the momentum behind the AI transformation accelerates, investors are increasingly weighing the prospects of AI-centric stocks in light of potential overvaluation risks. Although Bridgewater’s decision to scale back its Nvidia holdings indicates a cautious approach, the overall sentiment surrounding the disruptive capability of AI remains notably optimistic. With Nvidia’s earnings announcement set for November 19, 2025, and Ethereum’s on-chain metrics revealing resilience, the forthcoming weeks will be pivotal for evaluating the future trajectory of both AI equities and cryptocurrencies amid an increasingly interconnected financial landscape.