Smart money are selling out
Are you still buying?
In our previous issue, “Money loves momentum,” we talked about how market cycles accelerate when everyone is rushing into the same opportunity, and how the smart money quietly exits long before the crowd notices.
Today, we’re seeing that play out in real time.
Institutional investors, ie. Smart Money, the very same early adopters who rode the AI wave from the beginning, are now stepping aside, locking in gains, and repositioning for what comes next. Not because they’ve suddenly stopped believing in AI, but because they’ve already captured what they believe is the most of the upside.
Smart money is heading for the exits
Two major moves this month reveal exactly how the early movers are doing at the tail end of a bubble.
1. Peter Thiel exits Nvidia completely
As reported by Investing.com, Thiel’s fund has taken decisive action:
Thiel sold some 537,742 shares in NVIDIA Corporation (NASDAQ:NVDA) through the July-September period, with a Form 13F filing from his Thiel Macro fund showing that he no longer held any shares in Nvidia as of September 30.
If you don’t know who Peter Thiel is, he has built one of the most respected investing track records in Silicon Valley, from co-founding PayPal to being the first outside investor in Facebook, he has consistently finding great technology investments early and exiting when the valuations peak.
This is not re-balancing his portfolio because NVIDIA has appreciated so much, it’s a complete exit selling his entire NVIDIA stake.
When someone with Thiel’s track record rings the alarm, they’re not predicting the end of AI…
They’re signalling the end of the easy money in this phase of the cycle.
2. SoftBank unloads its entire Nvidia stake — for $5.83 billion
According to CNBC:
SoftBank said Tuesday it has sold its entire stake in U.S. chipmaker Nvidia for $5.83 billion. […]
The firm said in its earnings statement that it sold 32.1 million Nvidia shares in October.
Source: https://www.cnbc.com/2025/11/11/softbank-sells-its-entire-stake-in-nvidia-for-5point83-billion.html
Smart money isn’t abandoning AI.
They’re simply moving before the crowd does.
Why retail investors always get crushed
This is exactly the pattern we broke down in “Money loves momentum”:
Early adopters (smart money) buy early.
Early majority follow once results look strong.
Late majority start chasing after the headlines.
Laggards jump in only when the story feels “safe.”
And by the time Laggards buy in, the smart money is already selling quietly to them.
That’s how countless investors were left holding the bag during the dot-com crash.
The same psychology is at play today, only the asset is different.
When Peter Thiel and SoftBank are selling billions of dollars of Nvidia shares at record valuations, ask yourself:
Who is buying on the other side of that trade?
The answer is almost always the late majority:
Investors who mistake strong momentum for low risk.
What this means for you
If you’ve been following this newsletter, you’re already positioned ahead of 99% of investors because you understand one critical principle:
Follow where the money flows
Here’s what the smart money is signalling right now:
Valuations in certain names have gone beyond fundamentals
Large funds are reallocating before volatility hits
Momentum investors, especially retail, are at the highest risk of buying the top
You don’t need to be the fastest or the richest investor.
You just need to stop following the crowd.
The bubble playbook hasn’t changed
The dot-com bubble taught us a simple truth:
Early believers got rich
Late momentum chasers got wiped out
But the patient investors who waited for the crash and bought the survivors (Amazon, Google, etc.) built generational wealth
If AI follows a similar path, and history suggests it will, the greatest opportunities will appear after the bubble pops, not before.
Smart money are exiting.
Retail investors lose not because they aren’t smart, but because they’re late.
Our job here is to make sure you’re early.
To help you see the wind shift before the storm arrives.
To position you where the smart money is moving, not where the crowd feels comfortable.
If you like my work, I invite you to share it with others.
Eric Chang
Toronto, Ontario, Canada
November 18, 2025
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