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Hedge Fund Giants Are Betting on Gold: What Nvidia’s Downturn Means for Your Investments

Hannah Perry | May 1, 2025

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Nvidia and SPDR Gold Shares: Hedge Fund Moves You Need to Watch

In the high-stakes arena of trading, the movements of hedge fund billionaires can often signal important trends. Recently, two notable traders, Israel Englander of Millennium Management and Paul Tudor Jones of Tudor Investment, made significant changes to their portfolios that offer crucial insights into the current market landscape. They reduced their holdings in Nvidia (NASDAQ: NVDA) while increasing their positions in the SPDR Gold Shares ETF (NYSEMKT: GLD). Such moves are not just arbitrary; they’re tactical decisions influenced by market conditions, and here’s what you need to know.

Nvidia: A Dominant Player Facing Headwinds

For those unfamiliar, Nvidia is a powerhouse in the realm of AI accelerators, boasting a staggering 84% market share in the GPU sector. Specialized in accelerated computing, Nvidia provides the hardware and software that supercharge tasks related to data centers, scientific computing, and, of course, artificial intelligence (AI).

However, even a giant like Nvidia isn’t immune to challenges. Recently, it faced two critical headwinds:

  • Competition from Chinese Rivals: A startup named DeepSeek has demonstrated that it can train complex language models with less computing power, raising concerns about Nvidia’s GPU sales as AI infrastructure spending appears to slow.
  • Export Restrictions: The Trump administration has placed export limits on Nvidia’s H20 GPUs to China, with analysts estimating a potential revenue hit of $18 billion this year due to these sanctions.

Despite these challenges, Nvidia’s forecast remains bullish. Wall Street expects the company’s earnings to grow by 46% in fiscal 2026, making its current valuation of 36 times earnings seem quite attractive. So, if you’re a trader looking for long-term potential and have at least a three-year horizon, now could be the time to consider taking a position in Nvidia.

The Trend in Gold: SPDR Gold Shares ETF

Now, let’s pivot to the SPDR Gold Shares ETF, a vehicle designed for investors to engage with the price of gold without the need to physically store bullion. With about 946 metric tons of gold in its vaults, valued at over $100 billion, this ETF has been a haven for many traders amid falling equity markets.

Why is gold gaining traction? Simply put, during periods of economic uncertainty, gold has a proven track record of outperforming traditional stocks. In fact, during the last four market downturns, gold returned an average of 6% while the S&P 500 plummeted by an average of 36%. Conversely, in bull markets, gold returned an average of 61%, whereas the S&P 500 delivered 150% returns.

2025 Market Context

As we head deeper into 2025, economic trepidation is palpable. SPDR Gold Shares is up an impressive 28% year to date, while the S&P 500 has dipped by 6%. Such movement—with gold rising and equities tumbling—manifests a broader trend: investors gravitating towards safe-haven assets in times of instability.

Political tensions, particularly stemming from U.S.-China trade relations, have left many worried about a potential recession. Should President Trump’s tariffs drive the S&P 500 into bear territory, expect gold to continue its outperformance. Conversely, if trade negotiations yield favorable outcomes, the bull market’s momentum may return, at which point gold might underperform.

Key Takeaways for Traders

The activities of high-profile hedge fund managers like Englander and Tudor Jones serve as a critical compass for retail traders. Their decision to reduce Nvidia stakes while bolstering positions in gold is a clear reflection of a shift towards risk aversion, and it raises pivotal questions for market participants.

Key insights for traders:

  • Be cautious with high-flying tech stocks like Nvidia amidst regulatory and competitive pressures.
  • Consider gold as a protective hedge, particularly if the market sentiment shifts towards bearish conditions.
  • Monitor gold’s performance compared to equities closely; a divergence may signal broader market trends.

In conclusion, for traders following the trends, positioning yourself wisely now could yield significant returns in the near future. Whether you’re looking to buy Nvidia for the long haul or seeking the security of gold through the SPDR Gold Shares ETF, the choices you make today could define your trading success for years to come.

Stay savvy, stay energetic, and keep your strategies on point!