An AI Gold Rush?
Nvidia may be the biggest publicly traded, U.S. company that you’ve never heard of. Or maybe you did hear about its near record-setting stock price gain of 24% on May 25. That leap was so impressive that every network and financial publication rushed to put its spin on what’s driving this sudden surge.
Here’s what we know:
- Nvidia has been in business since 1993.
- Its shares are traded on the NASDAQ.
- It employs over 26,000 people.
- According to the company, 3.8 million developers use its technologies for accelerated computing and, 35,000 companies use its artificial intelligence (AI) technologies.
- It recently partnered with Microsoft to deliver a tool that enables developers to build Windows apps that deploy AI.
- Nvidia produces chips (e.g., the H100 )that increase app speed by 10x to 100x—a speed that’s required to train AI models such as Chatbots.
We discussed AI in this newsletter back in April, and recommended that you look before you leap into that world. We stand by that advice since every stock you purchase should play a role in meeting your long-term plan, align with your risk tolerance and function to balance your overall portfolio.
So, What’s Changed?
Our counsel has not changed. The jump in Nvidia’s share price put it close to joining an elite group of publicly traded companies whose value has reached $1 trillion+ at some point: Apple, Alphabet, Amazon, Tesla, Meta, and Microsoft.
Companies in nearly every industry are investing millions of dollars in AI, such as robotics and autonomous vehicles, and virtual assistants, so you might assume that other chip makers (e.g., Intel and AMD) are riding the AI wave. They haven’t matched Nvidia’s growth, but that’s not to say they aren’t doing well. As of market close on May 25:
- Intel’s shares were up nearly 10% year to date.
- AMD shares were up 67% year to date.
- Nvidia shares were up 160.6% year-to-date.
You Are Part of the AI Generation
If you’ve used Amazon, Netflix, HBO, Spotify, or Gmail, you’ve interacted with AI. Streaming services and Amazon use it to generate recommendations for you, and Gmail uses it to filter out spam. If you’ve “chatted” online with an airline, Starbucks, or the U.S. Citizenship and Immigration Service of the Department of Homeland Security (i.e., Emma Lazarus), you’ve interacted with AI. Putting an autonomous car in your garage may be a few years away, but AI is already in your home.
Teamwork Makes the Dreamwork
In the past few months, we’ve introduced you to several new members of the Obsidian team. One of them, Ashley Helm, works closely with Sean McCarron in helping take care of all account requests and questions. Both Sean and Ashely have long experience in the securities and insurance industries, so they coordinate their efforts and expertise so you can rest assured you’re in good hands.
Like Sean and Ashley, every member of the Obsidian team has unique skills and talents, yet there’s never only one person here who understands your situation, preferences, and goals. Whether behind the scenes or in one-on-one meetings, there’s an entire team of professionals working for you.
Where will you find beauty this summer?
Mountain or canyon? Atlantic, Pacific or Gulf of Mexico? National Park or bustling city? Historical landmark or theme park? There are so many vacation options in the United States that there is a perfect spot for every preference and budget.
You can blindly put a finger on a U.S. map and no matter where it lands, you’ll find beauty. Alaska’s forests and inland waterway are breathtaking, and Wyoming’s rangelands bring to mind the perilous journey of wagon trains in the mid-1800s. You might wander even further off the beaten track and into Arkansas’ canyons or Minnesota’s Boundary Waters Canoe Area Wilderness. (The mosquito is Minnesota’s unofficial bird, so don’t forget the bug repellent.)
Our investment recommendation to you is: Buy stamps for postcards. Connecting with loved ones for $.48 is money well spent.
How We Help
Resume: check! Firm handshake: check! Transfer of 401(k) plan: um . . .
It’s easy to forget to transfer funds held in a 401(k) plan after changing jobs. That’s why we suggest that you add it to your “New Job Task List.” And if adding “Transfer 401(k) funds” to your list reminds you that you left 401(k) funds at another past job, don’t be surprised. It happens all the time.
Transferring funds isn’t complicated, and it’s a chance to invest funds in a way that supports your goals and diversifies your portfolio. Just add “Call Obsidian” to your New Job Task List, and we’ll get together to look at your options.
Advisory Services offered through Obsidian Personal Planning Solutions, LLC. Securities are offered through Triad Advisors, member FINRA/SIPC. Obsidian Personal Planning Solutions, LLC, and Obsidian Personal Planning Solutions, Inc, are not affiliated with Triad Advisors.