Editor’s note: This article was previously published in July 2023. It has since been updated to include the most relevant information available.
The AI Boom is here, and folks, it is just getting started.
Call it a bubble. Call it overrated. But it’s neither. AI is the biggest technological paradigm shift since the internet. It is the real deal. It’s going to change the world.
And, unless you prepare for it, AI will kill your investment portfolio, too.
Because AI will permanently split society. You may think we live in a world of “haves” and “have-nots” today. But that divide is only going to get so much bigger in the “Age of AI.”
I’m not even talking about the whole “AI is going to take your job” idea. That will certainly happen to some of us. But we will find work elsewhere. Society always figures these things out.
Rather, I’m talking about the generational divide forming in the stock market. AI stock investors will get wealthy, and everyone else will spend the next decade playing catch-up.
That is, companies that make, sell, and use AI effectively will consume entire industries and become titans of business. In that process, they will destroy all the companies that don’t do the same.
The result? Stocks on the right side of the AI divide will soar — and not just this year but for the next 10 years. And stocks on the wrong side will crash.
We’re already seeing this play out right now.
AI Is Powering a Generational Shift
You may have noticed: Stocks are up this year, but the rally has been very narrow. In fact, tech and AI stocks are essentially the only stocks participating.
They are soaring while pretty much everything else is down!
The Global X Artificial Intelligence ETF (AIQ) is up more than 40% this year. Meanwhile, consumer staples, healthcare and financial stocks are flat. Utility stocks are down 10%, and energy stocks have barely eked out a 5% gain.
AI stocks are soaring, while everything else is dropping.
This isn’t unusual for a new tech paradigm shift.
The last time we saw a shift this big was in the early 1990s with the emergence of the internet. Back then, internet stocks started outperforming all other sectors in the market – and they didn’t stop outperforming for a whole decade.
I don’t mean to scoff at a 50% gain. But over the course of a decade? That’s not too impressive – especially when investors had the chance at more than 20X greater returns with tech stocks.
Well, let’s just say investors who didn’t buy internet stocks in the early 1990s are still kicking themselves today.
This is especially true when we look at individual stocks.
The Path to Making Millions
Had you invested $10,000 into internet leader Oracle (ORCL) in 1991, you would’ve turned that $10K into over $900,000 by 1999. A $10,000 stake in Cisco (CSCO) would’ve turned into $1.4 million. And a $10,000 stake in Qualcomm (QCOM) would’ve grown to over $1.5 million.
Now, let’s say you ignored the internet boom of the early 1990s. You called it a bubble. You said it was overrated. So instead of investing $10,000 into Qualcomm, you put that money into a safe utility stock, like Dominion Energy (D). By 1999, you would’ve had a whopping $10,500.
Or, let’s say you played it really safe and bought gold. By 1999, that $10,000 would’ve turned into… wait for it… $7,831.
You get the point, right?
Investors who bet on the right internet stocks at the dawn of the internet in the early 1990s turned thousands into millions. Investors who called the internet a bubble in the early ‘90s and bought safe utility stocks or gold barely broke even, at best.
We find ourselves in a similar situation today.
If you bet on the right AI stocks now – at the dawn of AI in the early 2020s – you are giving yourself the chance to turn thousands into millions. Those of you who call this a bubble and buy safe utility stocks instead? Well, you likely won’t make much (if any) money over the next decade.
Of course, the choice is yours.
The Final Word
And, luckily for you, we have the best AI stocks for you to buy today.
One great prospective investment is the very company that started this whole stock boom – OpenAI, the creator of ChatGPT.
Since ChatGPT’s launch in November 2022, the company’s valuation has grown by more than 100%!
But that’s just the start.
I truly believe OpenAI could be one of the world’s largest companies in the near future – if not the largest.
The good news is that OpenAI represents the potential investment opportunity of a lifetime.
The bad news is that it’s a private company, which means you can’t buy OpenAI shares on a public exchange.
However, I did unearth an investment “loophole” that allows you to take a stake in OpenAI now – before its highly anticipated initial public offering (IPO).
On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.