AI stocks appear to be “esquely similar” to the dotcom trend, warning that the CIO is overseeing $15 billion. Instead, invest in this “boring” corner of the market.
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AI stocks warn investor Richard Bernstein that it resembles Dot-COM stocks from the 1990s.
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Since the launch of ChatGpt, the S&P 500 and Nasdaq 100 have skyrocketed.
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Bernstein proposes dividend stocks such as utilities for stable combined returns.
Intoxicating topics Artificial Intelligence Stocks It looks like a dot-com bubble for the past few years, warning top investor Richard Bernstein.
The CIO, the $15 billion Richard Bernstein advisor, wrote in a June 30 post that AI trade is beginning to look rich and that there may be a time when investors will turn their attention to dividend stocks, the more “boring” corner of the market.
“Investors seem to have a universal focus on “ai,” which appears to look eerie similar to the 1960s technology bubble and the “tronics” trending “.com” inventory. Meanwhile, we see a lot of attractive, boring, boring, dividend paying themes,” Bernstein writes.
Since ChatGPT came to the market in November 2022, the S&P 500 and Nasdaq 100 have risen by 54% and 90% respectively. The ratings have skyrocketed towards levels comparable to those seen during the dot-com bubble and the 1929 peak, due to several measures.
Bernstein said he wasn’t calling the top, but the trade will ultimately go the other way, and the best time to invest in something is when it’s not good enough – not when a major gathering is already occurring.
“At the beginning of momentum and beta strategies, where momentum and beta strategies are most rewarded, investors’ fears lead them to emphasize dividends and low beta stocks,” he wrote. “In the cycle period after dividends and low betas become more attractive, investors’ trust will lead them to risk taking and momentum investment.”
“We are clearly not the beginning of a bull market, and as I wrote before, the profit cycle is beginning to slow down,” he added.
So dividend stocks could be ripe for gratitude, Bernstein said. He especially likes utility stocks known for issuing dividends.
Dividends are payments sent by the company to shareholders on a regular basis (usually quarterly) that can be used by investors as income or reinvested in stocks. If you reinvest, you can combine inventory positions.
When considering combined returns, dividend stocks actually hold their own shares against high-tech stocks, Bernstein said.
“One of the easiest ways to build wealth has historically been the power to make dividends even more complicated. Taking over dividends is boring as everything comes out, but it has become a huge success over time.”