Advisors weigh in on the heavyweight battle between Apple and NVDA

Ladies and gentlemen! We point your attention to Wall Street’s squared circle.

In the near corner, the chipmaker and reigning champion NVDA (Ticker: NVDA) is weighing in at a market-cap of $3.24 trillion and comes into the ring boasting a return of 173 percent year-to-date. In the past week, however, NVDA is down sharply due to worries about possible export cap on their specialized semiconductors.  

And in the opposite corner, the challenger Apple (Ticker: AAPL) comes in at a capitalization of $3.55 trillion and sporting a return of 26 percent year-to-date. Apple's stock is hitting new highs on optimism that AI will spur iPhone sales.

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Okay, okay, perhaps we’re taking it a little too far. But Wall Street’s touts do seem to be promoting a fight between this pair of market heavyweights. As “magnificent” as they performed in the past few years, some investors always want to pick the winner.

Still, not all financial advisors are taking the bait or placing their bets.

For example, Sean Beznicki, director of investments at VLP Financial Advisors, says Apple's self-reliance on its chip production and distinct market focus means there is no concern about competition or market leadership overlap between the two companies. Apple and NVIDIA operate in different areas of the technology sector with Apple focusing on consumer electronics and developing proprietary chips like its M-series processors, while NVIDIA leads in graphics processing units (GPUs), AI hardware, and software platforms.

“As we take a long-term view on asset classes and sectors, short-term performance fluctuations, such as one week of market activity, will not materially affect our overall portfolio management strategy, which remains focused on long-term growth drivers,” said Beznicki.

Meanwhile, Charles Failla, founder and CEO of Sovereign Financial Group, also does not see this mega-cap matchup along the lines of Ali versus Frazier.   

"Our shop focuses first and foremost on financial planning, then, we execute the asset management needs of those plans via models made up mainly of low-cost ETFs and Direct Indexing. So, with that in mind, we are not too concerned about things like Apple vs Nvidia since our portfolios will certainly have exposure to both,” said Failla.

That said, Failla admits to being mindful about over-allocating too much to any one sector. As a result, as technology has outperformed, he has trimmed back somewhat to the group as a whole, “not as a 'tactical call' but rather to maintain a disciplined approach to portfolio management."

Finally, Steve Stanganelli, certified financial planner at Clear View Wealth Advisors, does not expect Wall Street to instigate this superpower battle for too much longer. In his view, it's just their natural reaction.

“As far as I’m concerned, this too shall pass. But for now, it’s just indicating that people have an appetite for the story related to technology,” said Stanganelli. “Nvidia, Apple, and Microsoft (Ticker: MSFT) combined equal about 20 percent of the S&P 500 weight. It doesn’t matter to me or my models which one of these two tech titans wins the bragging rights contest since I own the index for clients.”