Caution regarding artificial intelligence
Concerns are not limited to these two specific investment firms. According to a monthly survey of fund managers in China, at least four other hedge funds appear particularly cautious regarding investments related to artificial intelligence. Of the investment firms that participated in the survey, only four maintained a clearly positive stance toward the sector, while the others avoided taking a clear position. Letters to investors indicate that an increasing number of professional managers believe that stock market valuations have exceeded the companies' actual financial data.
Valuations cause concern
Stocks linked to artificial intelligence have posted impressive gains within the year. Companies such as SK Hynix and Micron Technology have more than tripled their market capitalization, fueling one of the strongest rallies of recent years. However, volatility has increased noticeably, as investors begin to question whether current valuations can be justified by actual profit prospects. Wealspring Asset, which manages more than $1.4 billion, estimates that many companies operating in the AI infrastructure sector do not possess strong and sustainable competitive advantages.
Anthropic under the microscope
Banxia, which manages approximately $294 million, believes that the first signs of a slowdown are already appearing in international markets. According to its estimates, the annual growth rate of Anthropic's revenue may settle lower than investor expectations. The fund argues that major technology companies may limit their investments as the operating costs of AI models increase, while intensifying competition threatens to reduce Anthropic's market share among developers.
Abstaining from AI also has a cost
Despite growing skepticism, the choice to remain outside the sector has not proven particularly profitable. The two hedge funds have recorded small losses since the beginning of the year as they did not fully participate in the major AI rally, though they maintain significant returns over a long-term horizon. The Chinese CSI Artificial Intelligence Index has strengthened more than 35% since the beginning of the year, compared to a rise of approximately 5% for the country's main stock market index. Internationally, the picture is even more striking, with the KOSPI nearly doubling during the year, mainly thanks to the spectacular rise of SK Hynix and Samsung Electronics.
Fears are spreading to international markets
The warnings from Chinese hedge funds come at a time when doubts about the valuations of artificial intelligencecompanies are increasing internationally. The climate was further burdened by recent pressure on the Nasdaq Composite and reports that OpenAI is considering the possibility of delaying its long-awaited initial public offering (IPO) until 2027. Banxia founder Li Bei issues a clear warning to investors, stressing that those who choose to chase the AI rally should move with extreme caution, as current valuations may no longer reflect the companies' actual fundamental figures.
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