Sir Richard Spirit
Superstar
NVIDIA lives. Yall die.
Let’s bet accounts
Let’s bet accounts
Peter Thiel sells his Nvidia and Tesla shares. Sign of things to come?
- Thread starter Big Mountain Hélà
- Start date
Treblemaka
President, BYNKRadio.com (Retired)
AI isnt the bubble, the way its being invested in is.
In your opinion, what is a sustainable profitability model that will produce a return on the level of investment we've seen?
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IIVI
Superstar
It’s funny because the “seeking alpha” strategy is very close to my strategy. It’s why I always say to keep 75% of a portfolio on QQQ or S&P500. The rest of the 25% are on tech stocks (or whatever the current growth sector is), stocks that are terrific but got leveled for a nothingburger/noise that are in position for a turnaround, stocks that have a seriously low PE ratio for what their legit guidance indicates, something I have insider info/expertise on or some confident high beta “play”. Then I use options to generate money with sold put premiums. I only sell puts on stocks I don’t mind owning so it’s not really a loss if I get assigned, it’s more like a discount.I was part of a recruiting session with a bunch of finance guys in undergrad. They talked about this underperforming problem.
During junior year of my compEng undergrad , I was pleasantly surprised to have representatives of Morgan Stanley, Goldman, and Merrill Lynch trying to poach us. It was surprising because we weren't a Target School. They really wanted quants for some reason
At the time we were being snarky because the tech boom was just beginning and we had lots of options outside of finance. But They broke it down in a way that I had never thought about before.
From what the Goldman guy specifically said in response, was that for high net worth individuals there are different goals for investing beyond raw returns and they pay tooth and nail for them.
There are specific ways you can invest to compliment your existing business income for tax advantages . These investment strategies draw more from your bussinesss holding , than the market returns based on credits, exemptions, and government policy.
- For example there are specific tax advantages for investing in companies that do an incredible amount of r&d or special rebates for investing in an industry the govt deems necessary.
- Or through fancy derivatives you can make your primary business appear to be making losses due to its investments elsewhere. In this particular circumstance your tax liability had you lose a profit much higher, than the losses against the market.
- The general trend here is that a government policy(EPA,IRS,USCIS) makes investing through a fund as a high net worth individual very practical. There are certain ways through the eb-5 program that you can structure an investment too, to gain a green card. Its a task underperforming funds are great for
- Secondarily what you're talking about with high gains is called "beta", but what a lot of these private funds aim for is "alpha". So beyond tax advantage investments they seek alpha which is "noncorrelated gains" using statistical modeling.
- By this i mean that their stock portfolio goes up while the market goes down or the market goes up due to bubbles while the portfolio grows steadily. The objective here is to replace a traditionally safe , but low earning financial vehicle like a municipal Bond or a federal t-bill with a guaranteed , and nonvolatile equity based alternative.
- The significance of seeking alpha is that you're normally supposed to have a well-balanced portfolio of many different types of assets. This diversification occurs so that if there's a crash due to a bubble in one sector , your overall investment balance isn't affected. That's why it's a stupid idea to fill your retirement funds with only tsla, nvdia, microsoft, etc. However, a lot of the things you have to put in a balanced portfolio are very low earning despite their stability( like municipal bonds or UTilities or comodities like gold). These are the types of assets the alpha seeking funds are trying to compete with. Not the general market
- The third thing he explained to us is that some investors are limited by the intent of the money behind them.
- For example, an oil billionaire may die and leave a family trust but say that the trust must be invested in a very specific asset class like oil and gas extraction. Or a university may have their endowment and it must go specifically into renewable energy. Or Rich grandfather might gift to their portfolio to their children under an irrevocable trust stating that grandchildren can only invest in specific types of stocks.
- There are philanthropic organizations like the Rockefeller foundation or the Sorensen foundation who specifically limit their investing based on morals of the company or its founding team's diversity.
- In all of these scenarios the metric that is trying to be beat isn't the general market, but they are trying to beat the specific segment that this portfolio is limited to.
The final goal is for social investing. The general idea is that a fund like the medalion fund or burry's fund has semi-regular gatherings for its members. This is incredibly important, because they're great places to build a book of business or do social networking with people that you wouldnt ordinarily meet.
Think of a tech entrepreneur thats designed a new gopro competitor who needs vc funding. A fund with great networking connects him to a fellow investor who is a patent attorney that needs new clients for utility patents.
So wealthy people will purposely put money into a fund that is not giving them money because the fund is generating money elsewhere through social connections.
As an example ....
take a bare minimum accredited investor who needs 1 million AUM given to the fund in order to even enter the group. For this hypothetical example , let's say that its an accounting firm executive.
The fund in question earns 6% but the market returns 10% that year. This accountant has technically lost 4% or $40,000 that he could have gotten if he just bought the market through a mutual fund or a sector spyder.
However the same accountant ended up bringing $200,000 from meeting a single mergers and acquisitions attorney who had also invested in the fund and appeared at one of the regular gatherings. Here, he effectively got a profit from the fund of $160,000, despite the fund's market losses.
So in general, it's very silly for a normal person to try to emulate the investing strategies of a mega fund whether we're talking short funds, quant funds, hedge funds, etc because they don't have the asset restrictions or the net worth to actually make these investing strategies worth it. However, these funds often beat the metrics they're intended to beat or serve other profitable goals beyond beating the market
The 75% S&P500 steady growth/less volatile portion protects my portfolio during downturns while still keeping a steady gain during upturns. If the market were to ever get decked badly and HQ stocks like Amazon got dropped 60% but 75% of the portfolio only drops 30%, that’s the time I’d sell some S&P500 to buy leaps on Amazon (or buy the commons with margin). Take profits a year or two later on those options and roll that into QQQ/S&P500 to maintain 75% S&P500.
Additionally, 3/4 of the portfolio having a CAGR of 10-15% longterm is terrific. Having a decent performance on the other 25% in addition will blow away the market. All leading to insane compounding.
The only thing that’d destroy a portfolio made up of 75% S&P500 (actual high quality companies) is basically World War 3.
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IIVI
Superstar
The sentiments right now are too funny. A.I only started really hitting heavy mid 2023. It’s only been 2 years.
Imagine thinking the smartphone craze was finished in 2009
Companies did this during the smartphone era too. We acting like tech companies weren’t investing in each other during this time when streaming and smartphones was new?
Literally how business works. As long as there’s an output (people) it’ll flow.
Social media really made people dumb.
Imagine thinking the smartphone craze was finished in 2009
Companies did this during the smartphone era too. We acting like tech companies weren’t investing in each other during this time when streaming and smartphones was new?
Literally how business works. As long as there’s an output (people) it’ll flow.
Social media really made people dumb.
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IIVI
Superstar
You really think this guy is booking segments to do damage control?
Going to be victory laps, again.
Sir Richard Spirit
Superstar
He already told yall, half a trillion in orders. What are we talking about?
The “bubble” is being stabilized by real demand, real profit, and the standardization of ai taking place daily.
Yall worried about Peter Theil? Didn’t yall just have a thread on him being the anti christ?
the cac mamba
Veteran
interesting that this cocksucker sold right before earnings. he either missed out on , or saved a bunch of money 
IIVI
Superstar
Hope everyone sold yesterday to avoid making money!
The stock market is about to crash and bubbles pop!
We’re going back to the good old days of doing things manually by hand!
Tech is finished!
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IIVI
Superstar
Extreme fear. Time for people to sell everything because America is going to collapse.
All the bubbles are going to pop.
It’s donezo. This is it this time.
All the influencers and Fintwit are saying it!
I’m not serious btw unless you want to sell low and buy high. When those earnings reports fly it’s your choice if you don’t want to be invested.
Scustin Bieburr
Baby baybee baybee UUUGH
People keep being surprised that this bubble hasn't popped because they're using outdated ideas of how the market works.
They're assuming that there are not literally hundreds of millions of foreign and domestic investors putting small sums of money into the market by buying fractional shares on apps like robinhood, quest-trade or their local equivalents. They're assuming that companies aren't moving like they are in an era of corporate socialism where their risks are subsidized by tax payers and profits hoarded by executives and investors.
It's like people trying to navigate on a journey based on the assumption that the sun orbits around the earth rather than the other way around. When you're using outdated information, the outcomes you expect won't come to fruition.
I completely expect Jensen to just straight up lie to people and say "we're working on a GPU that will remain competitive because of software updates. You won't need to buy new GPUs every 2-3 years, but if you do, you will get a benefit of additional compute. Those who don't will still get great performance" then he'll put up some bullshyt numbers showing how a GPU that's old isn't competitive with a newer one, but then after a software update it still lags behind in performance but not by THAT much.
I know he'll do this at some point because he already did when trying to sell consumer GPUs with the RTX 50 series. It became a joke in the PC gaming community because they advertised the RTX 5070(mid range GPU) as having equivalent performance to an RTX 4090(premium GPU) because of the DLSS4 upscaling software. Essentially telling people that they should upgrade but if they don't it's fine because the DLSS4 update applies to the 40 series GPUs as well and gives them better performance.
Then watch as the stock jumps up in value as at least 10 million investors world wide put in even a fractional amount of money on the shares if not buying whole shares entirely thinking that now that the stock is a bit low it's a discount for them. This whole thing runs on hype and bullshyt. Just like how elon musk has been lying about mars colonies and self driving cars for what? 10 years now? and look at how the tesla stock has continued to climb. It doesn't matter that he's a nazi, it doesn't matter that the cars are overpriced garbage that spy on you. It doesn't matter that there is no commercial space freight industry that everyone is using and it doesn't matter if his robots never get made or do get made and are also overpriced trash. The PERCEPTION that there will be value is enough to make investors WORLDWIDE put in money using their apps.
They're assuming that there are not literally hundreds of millions of foreign and domestic investors putting small sums of money into the market by buying fractional shares on apps like robinhood, quest-trade or their local equivalents. They're assuming that companies aren't moving like they are in an era of corporate socialism where their risks are subsidized by tax payers and profits hoarded by executives and investors.
It's like people trying to navigate on a journey based on the assumption that the sun orbits around the earth rather than the other way around. When you're using outdated information, the outcomes you expect won't come to fruition.
I completely expect Jensen to just straight up lie to people and say "we're working on a GPU that will remain competitive because of software updates. You won't need to buy new GPUs every 2-3 years, but if you do, you will get a benefit of additional compute. Those who don't will still get great performance" then he'll put up some bullshyt numbers showing how a GPU that's old isn't competitive with a newer one, but then after a software update it still lags behind in performance but not by THAT much.
I know he'll do this at some point because he already did when trying to sell consumer GPUs with the RTX 50 series. It became a joke in the PC gaming community because they advertised the RTX 5070(mid range GPU) as having equivalent performance to an RTX 4090(premium GPU) because of the DLSS4 upscaling software. Essentially telling people that they should upgrade but if they don't it's fine because the DLSS4 update applies to the 40 series GPUs as well and gives them better performance.
Then watch as the stock jumps up in value as at least 10 million investors world wide put in even a fractional amount of money on the shares if not buying whole shares entirely thinking that now that the stock is a bit low it's a discount for them. This whole thing runs on hype and bullshyt. Just like how elon musk has been lying about mars colonies and self driving cars for what? 10 years now? and look at how the tesla stock has continued to climb. It doesn't matter that he's a nazi, it doesn't matter that the cars are overpriced garbage that spy on you. It doesn't matter that there is no commercial space freight industry that everyone is using and it doesn't matter if his robots never get made or do get made and are also overpriced trash. The PERCEPTION that there will be value is enough to make investors WORLDWIDE put in money using their apps.
duckbutta
eienaar van mans
This was Sam plan the entire time. Whatever the government decides to do with AI Sam is going to be in charge of it and will make 100 of millions if not billions from it.
Sir Richard Spirit
Superstar
Gritsngravy
Superstar
Who was the first people to sound the alarm on the ai bubble
Was it black rock or Goldman Sachs
Was it black rock or Goldman Sachs
Machines becoming sentient and learning on their own without the need of the current AI structural system is when shyt will get 
