Richard Stroud
United Kingdom
2m
COPIERS AND FOLLOWERS UPDATE Hi everyone, here is another update for you on the back an interesting few weeks for the markets. Up until the end of last week, markets were continuing to move higher on the back of new AI deals and a generally positive attitude towards stocks. However, things in the last few days have got more volatile as President Trump announced he was slapping new tariffs on China. These tariffs, upped to 100% on the back of a disagreement with China over the exports of rare earth minerals (essential for modern day technology), saw stocks falling away sharply on Friday. Although things have recovered a little since, this is yet another reminder to the markets that it will continue to be a wild ride as long as Trump is in charge. The idea of a stock bubble forming round AI, as mentioned in my previous post, is now starting to snowball as the case for this has been amplified by several financial directors of note. Investor Paul Tudor Jones and bank CEOs Jamie Dimon (JPMorgan Chase) and David Soloman (Goldman Sachs) as well as the Bank of England Governor Andrew Bailey, have all made cases for capital that has been deployed in AI not end up delivering returns. Whilst this may be the case and, just like the dot-com bubble there will most likely be a thinning out of companies that do not end up becoming profitable, I do not think that this will be the case just yet. In my opinion the situation with AI has not morphed into a big speculative mania just yet, although I do suspect further down the road that we might see that happen, and indeed it is something I am keeping a very close eye on. It is also worth noting that the biggest companies (think magnificent seven etc) that are at the forefront of the AI revolution are all still making big profits and have large cashflows, which is where this situation differs from the one 25 years ago or so. I personally think that the market has further to run, so in that respect I have made a couple of changes to the portfolio, with a position opened in the wider Nasdaq index and also a position in UK gilts, which I now think look very attractive. We may well see the market take a little breather at this point as this year has proved a positive one so far. There may well be further additions to come to the portfolio as I look to keep things positively invested for the moment, which I will of course keep you all informed about. In the meantime I hope you all have a great weekend and keep a watch out for the next update from me. Best wishes, Richard
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