Shares of fintech firms Upstart (NASDAQ: UPST), SoFi Technologies (NASDAQ: SOFI), and Affirm (NASDAQ: AFRM) were rallying today, up 6.1%, 3.7%, and 7.9%, respectively, as of 3:36 p.m. ET. Today's rally appears to be all about interest rates.
Instead of heading for the sideline, Form 13F filings with the Securities and Exchange Commission (SEC) show that most billionaire money managers were active buyers during the first half of the year. What's particularly interesting is that select billionaires have been piling into some of Wall Street's most beaten-down growth stocks. The following three supercharged growth stocks are down as much as 94%, yet billionaires can't stop buying shares of them.
The retreat is being driven by soaring inflation and rising interest rates, which are putting the brakes on the economy and forcing investors to rethink their growth expectations. Upstart Holdings (NASDAQ: UPST), for example, uses artificial intelligence (AI) to originate loans for banks on other lenders, and investors have doubts about how well its lending models will hold up as household finances deteriorate. Upstart's main goal is to displace the standard tools used to size up the risk in consumer lending.