It was a beautiful day in the financial district and I was walking towards my favorite coffee shop, when I saw a group of people huddled together, all staring at their phones. Wondering what was happening, I approached them and saw that they were watching the live stock prices of artificial intelligence (AI) companies. The excitement in the air was palpable, and it was clear that everyone was hoping to get in on the AI craze.
This scene isn't unique to my city, but is happening all over the world. AI is the buzzword that's driving the world crazy, and investors, big or small, are eager to get in on the action. But the question is, is it really worth the hype?
Investors seem to think so, given the numbers. The AI market is expected to grow to $190 billion by 2025, according to research conducted by MarketsandMarkets. Furthermore, AI was one of the best-performing sectors this year, with iShares Robotics and Artificial Intelligence ETF returning almost 26%.
But there are some concerning signs as well. On July 16th, the stock of the AI company, Beyond Meat, fell by almost 4% after a prominent short seller, Jim Chanos, said that the company was overvalued. It's worth noting that Beyond Meat is not an AI company (it makes meat substitutes), but the fact that it's stock price can be influenced by the AI hype shows just how much of a bubble it is.
The investment world is always looking for new opportunities to make money, and it seems that AI is the latest trend. But there are warning signs that a price bubble is forming, and if it bursts, it will wreck the entire rally.
A friend of mine who works in the finance industry shared his story with me recently. He invested a significant amount of money in an AI company, expecting it to perform well. However, the company's products didn't live up to the hype, and its stock price plummeted. He lost a considerable amount of money, and it was a hard lesson for him to learn. This story is just one example of how investing in AI stocks can be risky.
Before investing in AI stocks, do your research and make sure that the company you're interested in has a solid plan, good leadership, and a product that's worth investing in. Don't get caught up in the hype of AI and invest blindly. It's always a good idea to invest in companies that have a proven track record, rather than ones that are just starting out.
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Category: Finance
Curated by Team Akash.Mittal.Blog
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