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When AI chips battle, your portfolio makes money

Mar 14, 2023 / 07:34 AM IST

The artificial intelligence (AI) revolution is here. And international companies are lining up their strategies. Nearly all the Big Tech names have started designing their own chips. Additionally, some smaller and profitable ones are also listed and could make for interesting stock picks.

According to reports by McKinsey and PwC, the AI revolution could have an annual impact of $13-15 trillion on global GDP by 2030. Now some of these figures are not the latest estimates, but they give us a good sense of where things are headed. Incorporating recent developments in AI could increase these estimates significantly. For those who wish to invest internationally, in the US technology industry and global chip makers, here’s an interesting investment idea.

We believe that the state-of-the-art in current AI is so advanced that companies have been trying to hide, or underplay, the capabilities so as to avoid panic-mongering by the media, hysterical responses from the general population, and calls for stringent and highly restrictive regulations by politicians on the use of data and AI techniques.

In any case, the AI revolution is here as emphatically demonstrated by ChatGPT. In an earlier article we discussed the threats and opportunities from an investment perspective that ChatGPT is a harbinger of.

If AI is akin to the human mind, which thinks and generates insights, then AI chips are akin to the human brain, which stores and processes the sensory inputs. The processing of the new sensory inputs and stored inputs as well as thoughts by the human brain results in new insights by the human mind. AI chips, too, store sensory inputs in the memory chips and process those inputs to produce insights.