The AI boom is here, and it is just getting started! You can call it a bubble or call it overrated but it’s neither. AI is the biggest technological paradigm shift since the internet and, unless you prepare for it, AI will kill your investment portfolio, too. AI stock investors will get filthy rich, and all others will spend the next decade playing catch-up.
This article by Lorimer Wilson, Managing Editor of munKNEE.com, consists of edited and abridged insights from a newsletter I received today from Luke Lango (see here), editor of Hypergrowth Investing.
Lango reminds us that the last time we saw a shift this big was in the early 1990s with the emergence of the internet. Back then, internet stocks started outperforming all other sectors in the market – and they didn’t stop outperforming for a whole decade soaring more than 1,100% while consumer staples stocks rose just 200%, energy stocks gained less than 140%, and utility stocks added just 50%. A $10,000 investment in Oracle (ORCL) in 1991, for example, would have turned into $900,000 by 1999, a $10,000 stake in Cisco (CSCO) would’ve turned into $1.4 million and a $10,000 stake in Qualcomm (QCOM) would’ve grown to over $1.5 million.
This time round, says Lango, companies that make, sell, and use AI effectively will eat up entire industries and become titans of business. In that process, they’ll destroy all the companies that don’t do the same and the result will be that stocks on the right side of the AI divide will soar; and not just this year but for the next 10 years – and stocks on the wrong side will crash. We’re already seeing this play out right now. Refer to my recently published articles on TalkMarkets entitled These 9 “Penny” AI Stocks Are Up 43%, On Average, In Just 3 Months (If you are looking to invest in lesser value AI or AI-related stocks consider one of the few stocks trading for $5.00/share, or less, and also have market capitalizations of $50M, or more) and July AI Bubble Summary: Top 10 Stocks Up 99% In Last 3 Months (10 artificial intelligence and AI-related stocks, with market capitalizations of +$1.5B, have advanced by 70% or more (average of 99%!) since the bubble began to develop at the end of April. This article names them and their performances.)
Investors who bet on the right internet stocks at the dawn of the internet in the early 1990s turned thousands into millions and we find ourselves in a similar situation today. Lango rightly concludes that Investors who bet on the right AI stocks now – at the dawn of AI in the early 2020s – are giving themselves the chance to turn thousands into millions.