Tech Not 'A Bubble,' JPMorgan's Ward Says

What we know relative to 2000, because obviously everyone's comparing to the 2000s, is many of these companies are delivering fantastic profits. The reason NVIDIA has done so well is largely because of the profits delivered rather than just what we were hoping for the future. So in that aspect, I don't think tech broadly is a bubble. However, what we did learn from the 2000s and this is what I think we're starting to see now is usually not everyone is a winner and working out which are the specific companies which. Are going to take the market share, really be the dominant player? That's the really tricky part. So I think for us it was about, you know, acknowledging the text story. There is definitely tailwinds. To where this is going, we are believers in AI being a powerful force, but perhaps being careful about how you're actively managing some of that concentration risk. But also I think thinking more deeply because of course tech versus the rest is the big question. Just stepping back and thinking, well, if AI is going to be so transformative, they need consumers for the product. So looking outside of the big seven to the other 493 or elsewhere in the world and thinking about. What are we hearing about how other companies are going to use AI? And that will tell us a lot about the future earnings of the big seven. So for us, it was a little bit about carefully managing the concentration risk, but taking perhaps advantage of the consumers of AI rather than focusing squarely on the producers, which I think is where the market's been so far. That's interesting. In terms of allocation, then, would you take some profit in some of those big tech names to allocate to the consumer play around AI or is it a little early for that? No, absolutely. I think that's the right thing to be doing. And also it is just about managing concentration risk. You know, NVIDIA, 6% of the SP. And I think one of the things that concerned me was when I look at the the earnings expectations for a company like that at the end of next year. And, and these are people whose sole job is to analyze this company and consider where it's going, which is not my job. I'm a macro strategist. The range of those earnings expectation is so wide. So given that I just don't want quite so much risk in one single stock and therefore for us it has been about just actively managing and starting to maybe shuffle towards the beneficiaries rather than the producers.