The Nasdaq Composite entered a bear market in mid-March, and the losses accelerated in the second quarter as investors reacted to worsening inflation. By the end of June, the tech-heavy index was 31% off its high. But that didn't stop hedge fund managers John Overdeck and Steve Cohen from putting money into growth stocks.

In the second quarter, Overdeck increased his stake in Nvidia (NVDA 16.40%) more than fivefold, making it his sixth-largest position. And Cohen increased his stake in CrowdStrike Holdings (CRWD 6.34%) more than sevenfold, making it his fourteenth-largest position.

In both cases, the massive infusion of capital implies high conviction, and I think Overdeck and Cohen are on the right track. Here's why investors can buy both growth stocks with confidence today.

Nvidia: The gold standard in supercomputing

Nvidia's core innovation is the graphics processing unit (GPU), a chip tailor-made for complex computing tasks like rendering realistic visual effects and accelerating artificial intelligence (AI) applications. But in recent years, Nvidia has become more than a chipmaker, evolving into a robust computing company.

Nvidia's high-performance networking solutions have enhanced its relevance in data centers, and its growing portfolio of AI software has driven adoption in industries like retail, healthcare, and cybersecurity. But Nvidia Omniverse may be the most exciting innovation. The platform empowers creators to collaborate on virtual world design and other 3D projects, and it enables engineers to run physically accurate simulations to train autonomous robots and self-driving cars.

Those innovations have reinforced Nvidia's status as the gold standard in graphics and accelerated computing. Its technology has been adopted by every major cloud provider, and Nvidia holds over 90% market share in both workstation graphics and supercomputer accelerators. Moreover, management says gross margin should increase as software becomes a larger percent of revenue, meaning Nvidia is poised to become more profitable over time.

However, some investors are overlooking that long-term potential amid the short-term headwinds. Admittedly, Nvidia posted disappointing financial results in the most recent quarter, driven by a 33% nosedive in gaming sales as consumers battled high inflation. Total revenue climbed just 3% to $6.7 billion, and earnings plummeted 72% to $0.26 per diluted share. But inflationary headwinds are temporary, and the overarching investment thesis is still very much intact.

Artificial intelligence may be one of the most transformative technologies in human history, and the Nvidia brand has become synonymous with best-in-class AI. The company has consistently achieved top results at the MLPerf benchmarks, a series of standardized tests designed to measure the performance of AI hardware and software.

Additionally, realistic graphics will always be essential to the gaming and media industries, and demand for Nvidia chips and software should increase as use cases like augmented reality, virtual reality, and the metaverse continue to take shape. Management puts the addressable market at $1 trillion, leaving the company with plenty of room for future growth.

Currently, shares trade at 13.4 times sales -- a discount to the five-year average of 17.1 times sales -- which means now is a good time for patient investors to buy this growth stock.

CrowdStrike: The leader in endpoint protection

Digital transformation has been an accelerant for cybercriminals. As organizations have rushed to adopt cloud computing and software-as-a-service, many have failed to put adequate security measures in place. At the same time, the dark corners of the internet have made it possible for hackers to sell stolen data with relative ease. As a result, the cost of the average data breach hit a new high of $4.35 million in 2022, according to IBM.

Cybersecurity specialist CrowdStrike has capitalized on that opportunity. Its AI-powered platform includes 22 software modules, each delivered through a single lightweight agent that can be installed without a device reboot. That distinguishes CrowdStrike from other vendors, and it greatly reduces friction for customers. Moreover, CrowdStrike's AI learns from about 1 trillion security signals each day, and that scale makes its platform uniquely effective in preventing cyberattacks, according to CEO George Kurtz.

Those competitive advantages have made CrowdStrike the market leader in endpoint (device) security, and managed detection and response. CrowdStrike is also gaining share in other markets, including cloud workload security and threat intelligence.

Over the past year, CrowdStrike increased its customer base by 57%, and it kept its retention rate above 120%, meaning the average customer spent at least 20% more. That compounding effect fueled stunning financial results in the first fiscal quarter of 2023 (ended April 30, 2022). Revenue soared 61% to $488 million, and free cash flow climbed 34% to $158 million.

Turning to the future, CrowdStrike puts its market opportunity at $71 billion by 2024, and recent software innovations like CrowdStrike XDR -- a product that supercharges its AI engine with security data gathered from partners like Zscaler and Okta -- should help the company capitalize on that opportunity.

Shares currently trade at 26.9 times sales. That's pricey, but it's still cheaper than the three-year average of 37.1 times sales. That's why risk-tolerant investors should buy a few shares of this growth stock today.