10H·

Edit due to the AI "sell-off" 🦅

Edit: I don't think AI is over. But after such a long run of success in the AI sector , the market has now undergone a significant correction. A pullback of 10 to 20% is really just a blip in the portfolio for most of us long-time shareholders… but it’s not exactly nothing either.

Why all this, anyway?

There are concerns, based on the results of the midterms, there are fears that stricter AI regulations . On top of that, many investors—perhaps including you—are simply taking profits and reallocating their portfolios right now.

Whether you choose to do that yourself is , of course, based on their own investment case.

I think the midterms were the trigger, but not the actual cause. However, this shows quite clearly just how shaky the whole thing has become by now... in my opinion.

Things are just getting more turbulent up there. The Expectations are enormous. On top of that, there are other questions, such as whether there’s even enough electricity capacity will be available at all and whether the tech companies will be able to promises and forecasts in the long term.

I’m invested in tech myself, and the sector now accounts for a quite a large portion of my portfolio . I love tech… aka $MSFT (+1.13%) and $META (+3.1%) maybe even Accenture $ACN (-0.53%) —though Accenture’s stock has fallen precisely because of fears that AI could replace a large part of its business.

I’m not going to sell anyway. Especially not companies that are among the top 10 in the indices.

Still, I’m becoming a bit more thoughtful as the weeks go by. I’ve noticed that some defensive stocks during pullbacks
in the AI sector hold up significantly better. This is especially evident to those of you who have such companies in your portfolios.

Above all, “defensive” always sounds so boring. Yet, in addition to the classic defensive stocks, there are also many strong companies among us with strong business models, such as:

McDonald’s $MCD (+1.08%)
Coca-Cola $KO (+0.81%)
JPMorgan $JPM (+0.08%)
Walmart $WMT (-0.86%)
Mastercard $MA (+0.17%)
TK Maxx $TJX (-1.62%)
Allianz $ALV (-2.56%)
Berkshire Hathaway $BRK.B (+0.91%)
Siemens $SIE (-2.83%)
(Fun fact: You can see Siemens everywhere in rail facilities, not just on the trains themselves.)
And and and... the list goes on

Everyone just has their own favorite companies in this world.

I got sidetracked… 😅

What I really wanted to ask is:

How do you assess the current situation in the AI market? 📉📈

I’m an investor just like you, and I just want to know how others are thinking and reacting… if you’re reacting at all…

Peace ✌🏽

Poor Dad

@PoorDad

22H·

AI was a nice demonstration, but what now?

I don't think it's over either… but let's be honest: The euphoria is the only thing keeping this whole thing alive right now. ☯️

We were told something new , we celebrated it, we raised it up to the heavens and thought things would just keep getting better from here on out.

You always think that, with every sector cycle... 📈📉

And yes, things will go up again, but money can’t be pumped into one thing . So diversify a little, get a little bit of everything—to the newbies out there, or those who haven’t learned anything new yet. Unless you’re so sure that the music will keep playing.

We also have to keep in mind:

We, as private investors, are the catalysts for those who, as first were there. We are always last on the scene when the party is about to end.

A good example:

@Tenbagger-Capital … he’s just only now preparing with his portfolio 2036 . When the euphoria sets in later.

At least, that’s how I understood it.

If this future comes to pass, then that’s how it will play out.

Or, quite simply and more to the point:

The big players are always there first; it trickles down from the top 💩

Why do you think people say: “When the taxi driver starts talking about stocks, sell.” 🚕

By now, even the delivery drivers are talking about it (nothing against delivery drivers—I just couldn’t think of anything else).

My strategy is pretty boring and definitely not a solution: 🧯

GICS Ex-Tech with a pinch of Tech. It’s working out pretty well for me. And, of course, countercyclical… you can see what hype can do.

It’s just my opinion (which isn’t very meaningful), and I’d love to hear what you think. Is this the bubble bursting?

Image generated with AI

10 Comments

Donkey Diktator@DonkeyInvestor

10H

We're just getting started. Now is the time when non-tech companies need to—and hopefully will—leverage the productivity benefits of AI.

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Poor Dad@PoorDad

@DonkeyInvestor Don't you think that's exactly where regulations might come into play? Why do you think that's a good thing—or maybe not?

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Basti92@BavarianLion

10H

I’m definitely going to hold onto the big players! In my portfolio, for example, Amazon, Alphabet, and Microsoft! I definitely see a bright future for these companies, especially when it comes to AI! As a small “bet,” I only have Iren anyway—that’s an all-or-nothing play for me (but it’s only 0.8% of my portfolio)!

All in all, I’m still very bullish on AI, and a sell-off like yesterday’s can just happen!

Of course, the hyperscalers’ investments are massive and people are getting nervous, but that’s exactly my point: wait until the profits come in—then that will show up in the stock prices too!

Just my opinion 🙂

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Poor Dad@PoorDad

@BavarianLion The big players are the clients, so I'm staying in on this one. These massive investments might be one-time events, but they may even have to be even larger in the future. We'll see soon enough.

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Jakob C.@Creutzfeldt_Jakob

10H

Since I'm now fairly certain that I simply can't assess the situation anymore, I've largely pulled out of individual stocks and am relying on the collective wisdom of the market; as a result, I've increased my holdings of ETFs, some gold, and a few certificates.

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Poor Dad@PoorDad

@Creutzfeldt_Jakob Do you switch market phases often, or was that a one-time move?

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🏊🏻‍♂️ • 🚴• 🏃‍♂️ Endurance Life@MozartsGeist

Great series of posts from you—it was fun to read. The last few days really did call for a portfolio analysis. Investment portfolios were put to the test one after another. The turbulence in the tech sector has shown what an often-touted “concentration” actually feels like. For me, the maximum drawdown yesterday was just under 4%, after which the recovery in that same sector didn’t take long to materialize today. Surprisingly, though, there was a pullback today among my mostly solid positions. Exciting and captivating at the same time… we know that we know nothing! ☺️

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Poor Dad@PoorDad

@MozartsGeist Definitely exciting... I have to say, yeah, we don't know anything, but then intuition is the next best tool... My gut feeling actually tells me that in the short term, things will get very volatile and uncomfortable—but not in the other sector! 🤣 It's like a Spidey Sense🕸️ that I have...😁✌🏽

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jkb92@jkb92

Well, I'm expecting a backlash, at least for now. After a VIX spike like the one we saw yesterday, the (temporary) bottom isn't far off.

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Tobi60@Tobi60

If we didn't check our portfolio 20 times a day, I don't think we would have even noticed this "crash" yesterday.

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