NVIDIA Faces Scrutiny as Pension Funds Reduce U.S. Exposure, Citing Valuations

NVIDIA’s market capitalization now exceeds the combined value of more than half of the S&P 500’s constituents. A Financial Times report on October 5 said major global pension funds are beginning to reduce their exposure to U.S. equities, citing high valuations and concentration risk tied to AI-related stocks such as NVIDIA.

NVIDIA’s market capitalization is comparable to that of the S&P 500’s 256 smallest companies combined. Its operating income is roughly 2.5 times smaller than the group’s combined operating income. The gap is drawing attention as institutional investors, including Oxford Financial Group, are reported to be trimming their positions in NVIDIA.