David Tepper of Appaloosa Management, one the most respected and legendary investors in the hedge fund business, is betting big on technology.
"Any comparisons to past overheated markets are ridiculous. ... Look at where multiples and rates were in 1999. I'm not saying stocks are screaming cheap, but you're nowhere near an overheated market," Tepper told CNBC's Scott Wapner in a telephone interview Tuesday.
Technology stock "multiples are still low," he added. "They just look cheaper than any other part of the market even though they moved."
The hedge fund manager increased his technology holdings to 24 percent of his portfolio in the June quarter, by far his largest sector exposure, from 17 percent in the March quarter, according to GuruFocus.
In March of this year, Appaloosa managed $17 billion.
Tepper took a 3.7 million-share stake in Chinese e-commerce giant Alibaba, according to a required 13F filing with the Securities and Exchange Commission for the June quarter released on Monday.
He also bought 1.8 million shares in PowerShares QQQ Trust, a technology sector ETF which tracks the performance of the Nasdaq 100 index.
The firm also increased its positions in Micron Technology by 6.2 million shares to 12.9 million shares, Alphabet by 110,000 shares to 585,000 shares, and Western Digital by 1.3 million shares to 2.6 million shares.
On Micron and Western Digital, Tepper said that the "market got too negative" on the companies.
Appaloosa also added 449,000 shares of Facebook for a stake of 2.4 million shares, according to the 13F filing.
— CNBC's Scott Wapner and Jeff Cox contributed to this story.