Cramer Plans to Trim Data Center Stocks After Portfolio Held More Than 15% Cash

Jim Cramer plans to reduce data center stock exposure in his Investing Club portfolio, which held more than 15% in cash as a volatile week sharpened his focus on businesses outside artificial intelligence.

Cramer outlined the shift at the club's annual meeting Friday, Nov. 6. The cash allocation exceeded 15% at the meeting, while his stated preference was to direct more of the portfolio toward companies beyond the AI trade. His plan concerns the portfolio's stock holdings.

During the week ended Nov. 6, the portfolio increased its Boeing and Goldman Sachs positions and took profits in Cardinal Health. It also trimmed Eli Lilly and reduced its DuPont holding twice.

Cramer also named FedEx and Kimberly-Clark among stocks he favored. The portfolio had built up both holdings through purchases made about a month earlier.

Cramer's proposed reduction in data center stocks remained a plan at the Nov. 6 meeting.

The trading week followed the Nov. 3 midterm elections, in which Democrats won control of the House and Senate. After shares rallied the following day, the Nasdaq Composite fell 5.5% at Thursday's close. It rose 1.1% Friday to 24,579.42 but still finished the week down 3.4%.

Friday's gain followed an earlier rebound in U.S. stock futures. The index's recovery did not erase its weekly decline, leaving the portfolio decisions against a backdrop of sharp moves in both directions.

Financing is a risk for companies whose growth depends on expanding data center capacity. If construction slows, those businesses may face more pressure. Larger cloud operators may be better positioned to handle a slower buildout, although their growth could ease as well.

The portfolio's cash position leaves room for further changes as Cramer considers companies outside AI. He gave no indication that the allocation needed to be put to work immediately. "It's not burning a hole in my pocket," Cramer said.