The artificial intelligence or AI is already part of the common investors, who seek big opportunities after the announcement in November Microsoft supporting OpenAI and its ChatGPT. Chip firms like NVIDIA they have not been left behind searching position itself as a benchmark in this sector that has gained relevance in a matter of months. But you have to invest without losing in the attempt with some slogans in this regard, according to Naomi Rovnick on Yahoo Finance.
The investors seek exposure to generative AI, the technology managed by ChatGPT that learns from the analysis of large data sets to generate text, images and computer code. Companies are trying to use generative AI to speed up video editing, recruiting, and even legal work.
The consultant PwC foresees AI-related savings and productivity investments that will generate a world economic output worth $15.7 trillion by 2030roughly equivalent to China’s gross domestic product.
The question for investors is whether to jump on the AI bandwagon now or be carefulespecially given the growing concern among regulators about the potentially disruptive impact of technology.
“Clearly there will be winners in all of this,” he said. Niall O’Sullivan, Head of Multi-Asset Investments for EMEA, at Neuberger Berman. “It’s just that that’s very hard to be true for the entire market.”
It is still early
Rather than backing new startups or rushing to highly valued AI-themed businesses that could fail, savvy investors are embracing a lateral vision to support already proven technology companies that could benefit from the longer-term trend.
“It’s going to be as transformative as the Internet, as the mobile Internet, as the mainframe was,” he said. Alison Porter, Tech Fund Manager at Janus Hendersonwhose funds have positions in Nvidia, with Microsoft as its largest holding.
However, Porter also cautions that “we are still very early in AI use cases.
She favors big tech groups like Microsoft and alphabet-A because they have “solid balance sheets”, that make them “capable of investing in many different technological advances“, including his recent focus on AI.
beware of enthusiasm
The dizzying appraisals have made some investors Be wary of the tech hype cycle. This concept, popularized by the consultancy Gartnerstarts with a trigger, such as the launch of ChatGPTfollowed by inflated expectations and then disappointment. Even if a technology makes it to mass adoption, many early-stage innovators may fail along the way.
“There is a question about where we are on that curve with AI, where the hype is so visible,” he said. Mark Hawtin, Chief Investment Officer at GAM Investments. “There are ways to get exposure to the subject (AI) without choosing something that is highly valued.”
Pick and shovel
porter recommended support proven companies that they can be “great beneficiaries in terms of infrastructure provision” for future trends in generative AI that are, as yet, unclear.
GAM’s Hawtin said he has also looked for companies to provide the “picks and shovels” needed to enable new AI technology.
For example, AI systems require large volumes of data to analyze and learn from, but currently only 1% of global data is captured, stored and used, according to Bank of America.
Hawtin funds have Seagate Technologywhich makes hard drives and data storage products, and chip maker marvel tech for this reason.
Jon Guinness, Technology Portfolio Manager at Fidelity Internationalsaid the management consultancy Accenture it’s in his portfolio because, as companies consider how to use AI, “I strongly believe they should call in the experts.”
Stay away from big tech firms
Trevor Greetham, Head of Multi-Asset at Royal London Investment Managementhe said he was “Overweight” Dominant Tech Stocks partly because the AI backed up their assessmentsbut warned against AI-themed actions.
“There will be a lot of lost lottery tickets,” Greetham said, recalling the dotcom crash from the early 2000s.
Also keeping with great technology, Guinness said its funds have Amazonpartly due to their efforts to make AI less expensive for the companies. The service bedrock Amazon, for example, allows companies to customize generative AI models instead of investing in developing them themselves.
“The big benefits of AI,” Porter added, “are going to happen in the long run.”
“Investors want to invest in AI now and expect things to happen now,” Porter added. “But we would never blindly buy into AI and we don’t do things at any cost.”
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