Druckenmiller - All Eggs In One Basket is OK!
Besides Michael Burry, whom I admire from a distance, there is another legendary investor I also like to keep tab too.
He is none other than current Treasury Secretary - Scott Bessent’s ex-boss @ Soros Fund Management, Stanley Druckenmiller.
Like Michael Burry, I had a post on Druckenmiller a year ago on 24 May 2024, click here ! for details.
Background and Investment Mantra.
Stanley Druckenmiller is a billionaire investor known for making big, focused bets instead of spreading investments widely.
He believes if an investor has a strong conviction about an opportunity, “put all your eggs in one basket and watch the basket very carefully” is not a “bad” thing.
Previous Career.
Druckenmiller is famous for helping George Soros make a huge profit by betting against the British pound in 1992, a move that became known as “breaking the Bank of England.”
From 1981 to 2020, he ran Duquesne Capital Management and achieved about 30% average yearly returns with no losing years.
After closing his fund to outside investors, he continued to manage his own money through Duquesne Family Office, that has also delivered strong returns.
Investment Focus.
Druckenmiller tended to focus on companies and trends that can benefit from new technologies.
For example - artificial intelligence, that can (a) lower costs and (b) boost productivity.
Recently, his largest investments have included companies in (1) Health care, (2) E-commerce, (3) Engineering, and (4) Tobacco.
Duquesne Family Office’s 13F Filings.
One of Wall Street's most important data releases of the quarter occurred less than a week ago.
Institutional investors who are managing at least $100 million are required to file Form 13F with the Securities and Exchange Commission (SEC).
For the first 3 months of 2025, it could be seen that Druckenmiller has been busy.
He added a dozen new positions to the Duquesne Family Office portfolio during Q1 2025 and more shares to over a dozen existing positions.
The Purchases.
The new positions were:
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Flutter Entertainment Plc(FULT)$.
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Docusign(DOCU)$.
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Taiwan Semiconductor Manufacturing(TSM).
As usual, we are not Druckenmiller and vice versa.
Even if emulation is the “order of the day”, it still remains that each investor needs to perform one’s due diligence, before consider following his lead.
(1) $Flutter Entertainment PLC(FLUT)$.
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Druckenmiller boosted a tiny position in this online gambling stock in Q1 2025 by purchasing over 1 million shares.
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It was the 11th-largest holding in the Duquesne portfolio at the end of March 2025.
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Flutter Entertainment owns the popular FanDuel brand, that grew monthly users by +11% YoY to 4.3 million users at the end of March 2025.
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That works out to a market share of 43% in the US sports betting market.
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It is successfully leveraging its position as a leading sportsbook operator to boost its iGaming online wagering businesses.
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In March 2025, FLUT launched a FanDuel cross-promotion that has already lifted monthly iGaming users in the U.S. above 1 million.
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At the moment, the FanDuel sportsbook operates in only 23 states, and its online gambling operation in the US is just getting started.
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Its US iGaming business grew first-quarter revenue by +32% YoY to $472 million.
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Outside of US, iGaming is responsible for a majority of revenue.
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Within US, it made up just 28% of first-quarter sales.
(2) $Docusign(DOCU)$.
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In Q1 2025, Druckenmiller's family office started a new position in Docusign.
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At a value of $87.5 million, it was the 10th largest position in the portfolio at the end of March 2025.
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Sales growth has decelerated since the pandemic, but revenue is still moving in the right direction.
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Subscriptions were responsible for 97% of Q1’s revenue, that grew +7% YoY.
Quarterly earnings snippets:
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Docusign reported a gross margin that declined slightly, but at 78.9%, it is still a highly profitable subscription-based software business.
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Free cash flow (FCF) for Q1 2025 rose to +$232.1 million, which was an impressive 33% of total revenue.
(3) $Taiwan Semiconductor Manufacturing(TSM)$.
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This is one of Druckenmiller's biggest bets in Q1 2025., boosting his position by +457% to 491,265 shares.
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TSM is the world’s leading manufacturer of cutting-edge semiconductors.
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It is unknown when exactly Druckenmiller invested in TSM.
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What is known though was that TSM became much cheaper by late March 2025, selling for less than 22x its past year's earnings. (see above)
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Since then, TSM has recovered from its low points, thanks in part to its Quarterly earnings that have beaten Wall Street estimates.
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Q1 2025 revenue has soared +41.6% YoY and earnings per share (EPS) shot up +60% higher.
The Sales.
It was not all buy-buy-buy by Druckenmiller.
His latest approach to investing in AI revolution is raising eyebrows.
In less than 2 years, Druckenmiller has overseen the disposition of Wall Street's 2 hottest AI stocks - $NVIDIA(NVDA)$ and $Palantir Technologies Inc.(PLTR)$. What the …..
Dozens of companies have benefited from the evolution of AI.
However, no AI stocks have been the face of the movement, more than graphics processing unit (GPU) titan NVDA and data-mining specialist PLTR.
Since 2023 began, shares of Nvidia and Palantir have rocketed higher by +827% and +1,920%, respectively.
Despite all this, Druckenmiller has bid farewell to both stocks.
Accounting for NVDA’s historic 10-for-1 stock split in June 2024, the family office dumped all NVDA share (9,500,750) between 30 Jun 2023 & 30 Jun 2024.
For PLTR, Druckenmiller's fund shed all 769,965 shares from 31 Mar 2024 to 31 Mar 2025. (see above)
Possible Disposal Reasons ?
(1) Nvidia.
For Nvidia, the very tangible worry / concern is due to increase in competition.
Specifically, many of Nvidia's largest customers by net sales are developing AI-GPUs and solutions to use in their data centers.
I have touched on this before in my previous posts.
These “large” customers include : Alphabet (Google), Microsoft, Meta Platform and Amazon.
Although these internally developed hardware is unlikely to match the compute potential of Nvidia's Hopper or Blackwell, they will however be much, much cheaper and more readily available.
Nvidia's declining gross margin is further evidence that its superior pricing power has begun to wane.
Could this be the reason why Jensen Huang criticized US export controls blocking the sale of its AI chips to China and calling the export curbs a “failure” during a tech forum in Taipei on Wed, 21 May 2025 ?
Surely he must’ve known NVDA’s financial standings even though the company is only slated to report its earnings next Wed, 28 May 2025 ?
(2) Palantir.
As for PLTR, its multiyear government contracts and its subscription-driven model with Foundry, buffer and ensure it would not suffer the same fate as NVDA.
Just look, PLTR has (again) scored another contract with Pentagon to the tune of $1.3 billion.
Nevertheless, poor sentiment during a bubble burst would weigh on Palantir because of its outsized valuation premium.
A lot of analysts have issues with PLTR’s valuation.
On a trailing-12-month basis, PLTR has a staggering price-to-sales (P/S) ratio of 103.
Comparatively speaking, over the last 30 years - other companies on leading edge of game-changing innovations typically topped out at P/S ratios of 30 to 40 before tumbling.
No Megacap company has ever been able to sustain an excessive of a valuation premium over an extended period.
Will PLTR defy historical data and become the exception ?
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Do you think NVDA will still hand in a stellar quarterly earning results next week ?
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Do you think TSM is a better bet than PLTR, given the latter’s role expansion in US Defense department ’?
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Stanley Druckenmiller's investment approach is quite concentrated, and he's known for his bold bets. By putting "all eggs in one basket," he's essentially going all-in on his highest-conviction ideas. This strategy can lead to significant returns if his picks pay off, but it also increases the risk of substantial losses if they don't. It's a high-risk, high-reward approach that requires a deep understanding of the market and a strong stomach for volatility. What do you think about his strategy?
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Don't put all eggs in one basket
Wow