Enjoying the ride so far? I guess it depends on how you were positioned. Even a genius can look like an idiot if they are caught out of position. Those who had excessive exposure to tech (or chips) may not be enjoying things. Most of their 2024 gains have been wiped out.
It doesn’t take long when there’s a rush to the exits. On the other hand – if you pivoted into value orientated names (which traded at more reasonable multiples) – things will look more positive
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Investors Starting to Question AI’s ROIC
AI investors were caught off guard this week on news of China’s ChapGPT rival “DeepSeek”. It’s alleged DeepSeek was developed far more cost-effectively (millions vs billions) than OpenAI’s ChatGPT (and similar large language models). If true (and we don’t know) – this raises questions about the sustainability of current U.S. AI infrastructure investments – forecast to top $1 Trillion next year. All of a sudden – valuations for these AI stocks are being questioned.