Hedge funds Citadel and DE Shaw significantly reduced their holdings in Nvidia, while Renaissance Technologies and Marshall Wace increased their positions, ahead of the recent stock market downturn, according to a report by the Financial Times.PARA_BREAK_SENTINEL_9f8e7d6cThe report cites US regulatory filings as showing that Citadel, the most successful hedge fund in history, sold approximately 500,000 Nvidia shares in the second quarter, reducing its holding to $19m by the end of June, down from $60m at the end of March. DE Shaw also more than halved its Nvidia stake, cutting it to $1.4bn by the end of June.PARA_BREAK_SENTINEL_9f8e7d6cIn a more extreme move, Paul Singer's Elliott Management, which had recently cautioned that Nvidia was in a "bubble" and that the hype around AI was "overblown," completely exited its position, selling all 50,000 of its shares.PARA_BREAK_SENTINEL_9f8e7d6cConversely, Renaissance Technologies, the quantitative firm founded by billionaire Jim Simons, acquired 1.5m Nvidia shares, increasing its total to 7m shares valued at $867m by the end of June. Similarly, London-based Marshall Wace bought around 3.7m shares, bringing its holding to $1.5bn.PARA_BREAK_SENTINEL_9f8e7d6cInvestor enthusiasm had driven Nvidia's stock up by 150% in the first half of this year, following a tripling of its value the previous year due to surging demand for its advanced semiconductors, which are crucial for building artificial intelligence systems.PARA_BREAK_SENTINEL_9f8e7d6cHowever, during a market rout earlier this month, Nvidia lost approximately $400bn in value within minutes as investors grew anxious about the global economic outlook. The stock has since recovered some of the losses.PARA_BREAK_SENTINEL_9f8e7d6cAn analysis of SEC filings by the Financial Times, which looked at 23 major hedge funds managing a total of $1.4tn in US equities, revealed that, on average, these funds reduced their Nvidia holdings by about 6%.PARA_BREAK_SENTINEL_9f8e7d6cMeanwhile, Man Group and Two Sigma collectively acquired an additional 600,000 Nvidia shares by the end of June.PARA_BREAK_SENTINEL_9f8e7d6cAmong other members of the so-called "Magnificent Seven" tech stocks, funds generally increased their positions in Apple and Microsoft while reducing their stakes in Alphabet, Amazon, Meta and Tesla.