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Steve Cohen's Bullish Take on AI: Stocks to Consider
Billionaire hedge fund manager and New York Mets owner Steve Cohen is bullish on the markets, thanks to artificial intelligence (AI). He believes AI will create new investment opportunities, improve efficiency in the markets, and help to reduce costs.
Notably, Steve shared some interesting analysis by his team of Economists suggesting AI can drive major productivity gains and even upwards of 400 basis point improvements to net profit margins. Indeed, with a recognition that earnings are a major factor driving stocks, the ability of companies that capitalize on these trends represents a major bullish tailwind.
Here are just some of the major companies that are making AI happen with their long term stock market price charts. While historical performance is not indicative of future returns, the charts below highlight how these mega-cap market leaders have won over the past decade by continuing to innovate. AI is simply that new frontier.
Nvidia (NVDA): Nvidia is a leader in the graphics processing unit (GPU) market. GPUs are used in a variety of applications, including AI, machine learning, and data analytics. These are the specialized chips that drive the processing power of AI. For example, Nvidia's GPUs are used to power AI research and development. The company's GPUs are also used in a variety of AI-powered products and services, such as self-driving cars and virtual assistants.
Alphabet (GOOGL): Alphabet is the parent company of Google, which is a leader in AI research and development. Google's AI technologies are used in a variety of products and services, including search, advertising, and self-driving cars. For example, Google's self-driving car technology is powered by AI. The company's AI-powered search engine is able to provide more relevant results than ever before. And Google's AI-powered advertising platform is able to deliver more relevant ads to users, which is beneficial for both advertisers and users.
Microsoft (MSFT): Microsoft is another major player in the AI space. The company's AI technologies are used in a variety of products and services, including Cortana, Azure, and Bing. For example, Microsoft's Cortana virtual assistant is powered by AI. The company's Azure cloud computing platform offers a variety of AI services, such as machine learning and natural language processing. And Microsoft's Bing search engine uses AI to provide more relevant results.
Amazon (AMZN): Amazon is a leader in e-commerce and cloud computing. The company is also investing heavily in AI technologies, which it plans to use to improve its products and services. For example, Amazon's Alexa voice assistant is powered by AI. The company's AI-powered recommendation engine helps users find products they are likely to be interested in. And Amazon's AI-powered logistics system helps the company to deliver products more quickly and efficiently.
Tesla (TSLA): Tesla is a leader in the electric vehicle market. The company is also investing heavily in AI technologies, which it plans to use to improve its self-driving car technology. For example, Tesla's Autopilot system is powered by AI. The company's AI-powered battery management system helps to improve the efficiency of its electric vehicles. And Tesla's AI-powered manufacturing process helps the company to produce its vehicles more quickly and efficiently.
These are just a few of the many stocks that have exposure to the major themes of AI. Notably, these are the types of companies found in broad market funds. That type of diversification can be a good step for investors. As AI continues to evolve, it is likely that these stocks will continue to outperform the market.
Here are some additional tips for investing in AI stocks:
Do your research. Before you invest in any AI stock, it is important to do your research and understand the company's business model and its plans for AI.
Diversify your portfolio. Don't put all your eggs in one basket. When investing in AI stocks, it is important to diversify your portfolio and invest in a variety of companies.
Be patient. AI is a long-term investment. Don't expect to get rich quick by investing in AI stocks.
By following these tips, you can increase your chances of success when investing in AI stocks.