The California Public Employees’ Retirement System (Calpers), the largest public pension in America with over $480 billion in assets, recently made significant adjustments to its investment portfolio, particularly in the chip industry and media companies.
Investing in Intel and Nvidia
Calpers doubled down on its investment in Intel stock during the fourth quarter, purchasing an additional 8.1 million shares, bringing their total holdings to 16.1 million shares. This move comes as Intel stock experienced a remarkable surge of 90% in 2023, outperforming the S&P 500 index’s 24% increase. However, in the current year, Intel shares have declined by 14%, while the index has seen a modest rise of 4.7%.
On the other hand, Calpers significantly increased its stake in Nvidia, a leading chip manufacturer. While the specifics of the investment were not disclosed, this move reflects Calpers’ confidence in Nvidia’s growth potential. In 2023 alone, Nvidia stock skyrocketed by an impressive 238%, and thus far in 2024, shares have already risen by 46%.
Adjustments in Media Investments
Apart from its focus on the chip industry, Calpers also made strategic changes to its investments in media companies. The pension fund acquired additional shares of Walt Disney, demonstrating continued belief in the company’s success. Unfortunately, specific details regarding the size of the investment were not provided.
However, Calpers reduced its position in Netflix during the fourth quarter. The precise amount of shares sold was not disclosed, but this adjustment suggests a shift in strategy or concerns about the streaming giant’s future performance.
Calpers’ Investing Approach and Non-Commentary Policy
In response to inquiries about these investment changes, Calpers explained that it operates as an index investor and therefore refrains from providing commentary on individual holdings. This decision to remain silent on specific investments aligns with Calpers’ approach as a massive pension fund and one of the world’s largest private-equity investors.
Calpers’ recent moves in the chip industry and media companies highlight its proactive approach to managing its substantial assets. As the pension fund continues to navigate the ever-changing investment landscape, it aims to generate favorable returns while preserving the interests of its beneficiaries.
Unabated Investor Enthusiasm for Artificial Intelligence Boosts Nvidia Shares
The soaring popularity of artificial intelligence (AI) has ignited unyielding investor enthusiasm for Nvidia, propelling its shares to new heights. CEO Jensen Huang confidently declares that 2024 is poised to be a substantial year for the advancement of this groundbreaking technology. Surprisingly, the demand for Nvidia’s chips by industry-leading companies surpasses even the fervor of its investors. Meta Platforms, for instance, intends to own billions of dollars’ worth of Nvidia chips by the conclusion of this year. Additionally, Tesla has allocated over $500 million for Nvidia hardware in 2024.
Calpers Bolsters Nvidia Investment
In a bid to embrace the flourishing market, Calpers made a strategic move by purchasing an additional 1.8 million Nvidia shares. As a result, their total holdings elevated to 7.5 million shares by the end of the fourth quarter.
Disney Shares Surge with Strong Earnings and Promising Outlook
2023 Highlights for Disney and Netflix
While Disney observed a modest 3.9% increase in stock value throughout 2023, Netflix experienced exponential growth, with shares skyrocketing by an impressive 65%. As we embark on a new year, both companies continue to witness positive momentum. The shares of Disney have already surged by 20%, whereas Netflix shares have seen a 15% increase so far.
Netflix Reigns Victorious in the Streaming Wars
Netflix remains a formidable competitor to Disney in the streaming industry. A stellar performance in the fourth quarter, surpassing its own growth forecasts, and a surge in monthly active users on its ad-based plan solidify Netflix’s position as the streaming frontrunner. Although BofA Securities has already declared Netflix the victor of the streaming wars, the company’s recent acquisition of WWE wrestling shows indicates an unwavering commitment to further expansion.
Calpers Adapts its Portfolio
To streamline its investment portfolio, Calpers made strategic adjustments by selling 28,464 of its Netflix shares, gradually reducing its holdings. As of the end of 2023, Calpers held a total of 785,855 Netflix shares.
Inside Scoop: Unveiling Stock Transactions by Prominent Figures
The Inside Scoop is a recurring feature that delves deep into the world of stock transactions executed by various individuals, including corporate executives, board members, influential shareholders, politicians, and other prominent figures. As insiders, these investors possess invaluable insights and are obligated to report their stock trades to the Securities and Exchange Commission (SEC) and other regulatory bodies.
