NVIDIA stock (
NVDA
) just hit $719, and it feels like a huge bubble looking at the chart. $1.7T in market capitalization is insane. It's 1/20 the US' GDP, greater than that of Switzerland. I recall it hitting $300 less than a year ago and it felt like a stretch given the market fear of recession at the time.
We probably shouldn't conflate market cap with an investment fund for building chip factories, but Sam Altman is trying to raise $7T to build AI chips because he "often complained that there aren’t enough of these kinds of chips".
That's 4x the current NVIDIA's market cap. Does that mean NVIDIA's bubble is actually cheap? Probably not because that fund would be used over a long period of time, whereas the stock's $1.7T is formed by speculative money. It's counter-intuitive, to say the least.
In the absolute, it looks like a bubble. You zoom into the chart and it's sort of insane. But when you zoom out and consider that it has been growing at the same rate since 2015-2016 era, consistently staying within a bounded trend up, it doesn't look like it's about to pop.
If I had cash lying around, I would invest into it, probably not 100% of that because I also believe there's downward risk with anything that seems to grow too fast (return to the mean etc). Right now I have other investments that are good and when factoring removing those positions in favor of NVIDIA, it doesn't look that attractive. But what do I know, this is all feelings and guesses.
NVDA
) just hit $719, and it feels like a huge bubble looking at the chart. $1.7T in market capitalization is insane. It's 1/20 the US' GDP, greater than that of Switzerland. I recall it hitting $300 less than a year ago and it felt like a stretch given the market fear of recession at the time. We probably shouldn't conflate market cap with an investment fund for building chip factories, but Sam Altman is trying to raise $7T to build AI chips because he "often complained that there aren’t enough of these kinds of chips".
That's 4x the current NVIDIA's market cap. Does that mean NVIDIA's bubble is actually cheap? Probably not because that fund would be used over a long period of time, whereas the stock's $1.7T is formed by speculative money. It's counter-intuitive, to say the least.
In the absolute, it looks like a bubble. You zoom into the chart and it's sort of insane. But when you zoom out and consider that it has been growing at the same rate since 2015-2016 era, consistently staying within a bounded trend up, it doesn't look like it's about to pop.
If I had cash lying around, I would invest into it, probably not 100% of that because I also believe there's downward risk with anything that seems to grow too fast (return to the mean etc). Right now I have other investments that are good and when factoring removing those positions in favor of NVIDIA, it doesn't look that attractive. But what do I know, this is all feelings and guesses.