Ken Griffin Ditches Nvidia, Bets on 3 Soaring Stocks Instead.

Every quarter, institutional investors with at least $100 million in assets under management are required to file Form 13F with the Securities and Exchange Commission. This filing allows investors to see what Wall Street's most successful investors purchased and sold in the most recent quarter.

Among the many anticipated 13F filings from billionaire asset managers is that of Ken Griffin's hedge fund, Citadel Advisors. Since its inception, no hedge fund has been more profitable than Citadel, which often hedges its common stock positions with various put and call options.

What's noteworthy about Citadel's latest 13F is that Griffin and his investment team were big-time sellers of artificial intelligence (AI) leader Nvidia (NASDAQ  NVDA) and avid buyers of three other high-octane growth stocks.

Nvidia's hardware and software have fueled its historic gain. The company's H100 graphics processing unit (GPU) has quickly become the standard in AI-accelerated data centers running generative AI solutions and training large language models (LLMs). Meanwhile, Nvidia's CUDA software platform is the toolkit developers use to build LLMs.

Despite these first-mover advantages, Griffin's Citadel sold 9,282,018 shares of Nvidia during the June-ended quarter, ultimately reducing its stake by 79.3%. Although profit-taking might explain some of this selling activity, history may be playing a meaningful role in this decision.

Over the previous 30 years, there hasn't been a high-profile innovation, technology, or trend that's escaped an early innings bubble-bursting event. Investors are always overly optimistic with regard to how quickly they expect a new technology or innovation to take hold. Should AI follow the path of previous next-big-thing innovations, no company would be hit harder by the AI bubble bursting than Nvidia.

While Ken Griffin and his investment crew were sending shares of Nvidia packing, they were busy piling into three supercharged growth stocks.

Palantir Technologies (5,222,682 shares purchased)

The first fast-paced stock that had the investment team at Citadel's hedge fund mashing the buy button with regularity during the second quarter is cloud-based data-mining specialist Palantir Technologies (NYSE  PLTR). The more than 5.22 million shares purchased increased Citadel's stake in Palantir by 1,140% over where things stood on March 31, 2024.

Pinterest (4,472,384 shares purchased)

A second supercharged growth stock that Ken Griffin's Citadel hedge fund was a buyer of as it was disposing of the lion's share of its Nvidia stake during the June-ended quarter is social media platform Pinterest (NYSE  PINS). To offer some context on just how much this position grew, Citadel only held 12,909 shares of Pinterest at the end of March.

Broadcom (1,880,740 shares purchased)

Perhaps the biggest surprise of all is that Ken Griffin's Citadel hedge fund was busy scooping up shares of AI networking solutions specialist Broadcom (NASDAQ  AVGO) while sending 79% of its position in Nvidia to the chopping block. The 1,880,740 shares of Broadcom purchased by Griffin's fund increased its stake by nearly 64% from the sequential quarter.

Should you invest $1,000 in Nvidia right now? Before you buy stock in Nvidia, consider this  The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them.Citadel Advisors is a hedge fund founded by Ken Griffin in 1990. It is one of the most successful hedge funds in the world, known for its expertise in trading and investing in a wide range of assets.