We're exiting our position in this chipmaker and right-sizing another winner

We're making two trades in Friday's tough broader market. We're exiting our position in Broadcom, selling our remaining 120 shares at roughly $326 each. Jim Cramer's Charitable will no longer own a position in AVGO.

We're selling 85 shares of CrowdStrike at roughly $251. The Trust will own 665 shares of CRWD, reducing its weighting in the portfolio to from 4.25% from 4.8%. We're taking advantage of Friday's small bounce in Broadcom shares to sell our remaining stake, capturing an average gain of roughly 128% on stock we purchased in 2023 and 2024. We sold some shares on Tuesday to take the position size down to 1% from 1.36%.

Still, with the data center theme struggling due to funding concerns, Jim wants to take a more defensive approach to the portfolio and hold fewer names until we see how the pending Anthropic IPO, expected as soon as mid-November, plays out and gain more clarity on Meta Platforms' future equity raises.

"The collapse of the data center requires us to circle the wagons," Jim said. "We can't have too much of the ones we have. We can pick as we did with GEV but nothing aggressive. And all tag ends should go like Broadcom."

He continued: "Circling means we want to be bigger in the better ones." For example, he expressed the difficulty of selling Micron at these levels and would rather be a buyer of the memory maker at some point.

We may be selling Broadcom after a brutal decline from its June highs; we took a chunk off the top in the $480s, but we've cut this position over the past few months at higher prices. We understand there may be frustration around selling an AI beneficiary with a strong revenue outlook and reasonable valuation after a big drawdown. But these sales are about protecting our big gains and limiting our exposure to a group that has come under fire. This line of thinking served us well in Arm Holdings when we exited our position around $300 in early July, and in our Corning exit in the mid-$140s last month.

We will also sell some CrowdStrike into this week's roughly 9% rebound. This decision doesn't reflect anything negative about the cybersecurity company's fundamentals. Rather, it's a portfolio management move to right-size the position (once again) following a big move that pushed its weighting toward the top of the portfolio. From this sale, we will realize a gain of roughly 187% on stock purchased in late 2024.