The Black Swan author Nassim Taleb is warning that Monday’s brutal selloff in Nvidia Corp. is just a taste of what’s in store for investors who blindly piled into Wall Street’s AI-driven stock rally.

Speaking at Miami Hedge Fund Week, Taleb told Bloomberg that investors should brace for potential drawdowns “two or three times bigger” than Monday’s selloff, which he considers ...

Taleb said too many investors have been bidding up prices of AI-related stocks without properly knowing details of how it functions. He described technology firms as “gray swans,” as investors ...