Subscribers will have noticed that I am focused almost exclusively on AI stocks. There is a reason why. I am only interested in stocks delivering explosive growth. The faster the company grows, the faster and higher the shares rise. Buy defensive stocks if you like, but you won’t hear about them from me.
Much of the growth in this market is happening with stocks connected with AI and the data centre build-out, so that is where I am looking for action. As noted in recent alerts, these stocks are characterised by extreme volatility. Be bold, have faith in those great fundamentals and try to turn those wild share price ups and downs to your advantage.
One way to do this is to use $ cost averaging. Find an exciting stock or ETF and invest a regular amount each month, with or without a little leverage. Don’t go mad because you do not want to be forced to sell.
Another thing in which I am becoming interested is what I call keyword investing. When companies report their results, somewhere in that text may be some keywords such as: inflexion point, accelerating, data centre, AI or massive opportunity. What I am particularly interested in is the first mention of these keywords. Look at the example below.
Nvidia first publicly mentioned an inflection point related to artificial intelligence during its Q4 fiscal 2023 earnings call (held on February 22, 2023). At that time, CEO Jensen Huang declared that “the AI inflection point is here” due to the accelerated interest and broad adoption of generative AI and large language models.
ON 22 February 2023, Nvidia shares, adjusted for a subsequent 10:1 share split, (10 June 2024) were around $20. Good time to buy a few!
Below is another example.
Credo Technology Group first mentioned artificial intelligence in a quarterly earnings report on November 30, 2022, during the company’s Fiscal Q2 2023 earnings call.
At that time, management highlighted how their high-speed connectivity products were uniquely suited to support the emerging compute clusters and scaling needs of AI workloads. By their Fiscal Q3 2024 earnings report (reported in early 2024), the company formally stated that Generative AI had driven an “inflection point” for the industry, making AI deployments their primary long-term growth driver.
Credo shares were $13.93 on 30 November 2022. On 27 February 2024, when the company began talking about an inflexion point, the shares were $22.02. Sounds like a pretty cool investment technique, yeah!
