Investors are now turning to Nvidia!

Nvidia Corp (NASDAQ: NVDA) is increasing investor preference for Broadcom Inc (NASDAQ: AVGO) as they shift their exposure to chips. Investors are responding by investing in Nvidia's broader graphics processing unit growth, in contrast to Broadcom's hyperscaler-focused approach.

Although Broadcom has paused after significant gains, Nvidia stands out with its larger customer base and strong long-term growth potential. In October, Nvidia achieved a historic milestone by reaching a market value of $4.5 trillion.

Another important point for investors was Aureus Asset Management's CEO Karen Firestone joining CNBC’s ‘Mid-Report’ to detail the recent portfolio movements. Firestone described the firm's recent trades as active portfolio management. While purchasing Nvidia shares for the ARIES portfolio, the decision was made to reduce the position in Broadcom.

Firestone noted that the firm initially bought Broadcom in June 2024, and the stock increased by 160%. This has become a significant position providing substantial long-term gains.

The firm is increasing its overall chip position while reallocating some of the gains. Firestone emphasized that holding both stocks makes sense, despite not previously owning Nvidia shares. She stated that Nvidia's GPU business has broader growth potential compared to Broadcom's business model, which mainly targets hyperscalers.

Firestone mentioned that Nvidia's larger customer base and long-term opportunities currently make it a better investment choice, but they continue to maintain a balanced approach towards both companies.