If AI Bubble Pops, What To Buy?

The AI hype seems to be relentless, supporting the rise of the overall market and related sectors. Investors can't help but worry that the AI bubble will burst like the dot.com bubble did in 2000. If the AI bubble pops, are there any safe-haven sectors or new growth points to invest in?

avatarTigerong
2024-07-21
      Why did small-cap and value stocks take so long to rally considering the “higher for longer” interest rate theme has been running for a while? It’s likely because the AI rally captured most of investors’ attention. This may be a delayed effect in a small-cap value rally. At the same time, we shouldn’t write off growth stocks altogether. There is no certainty that the small-cap value rally will sustain, as it did fizzle out for months after a brief rally at the start of 2024. Also, AI-related stocks have run up so much that experiencing some correction is warranted and I won’t say the AI run is over just yet. One might ask why the increased market expectation of a looming rate cut helped value small caps and not growth stocks, since lower rates are better for the latter
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