Is it really "AI bubble" time?
In recent times, many AI stocks have begun to fluctuate.
Many companies' revenue is still growing, and the AI trend has not disappeared.
But the problem may not be the question of...
* * "Will AI fail?" * *
What the market is more concerned about.
Could be a * * Bond Yield or a rising U.S. government bond yield * * 📈
So what does Bond Yield have to do with AI stocks?
Many technology stocks and AI stocks are priced high because investors expect them to make huge profits in the future.
But as interest and Bond Yield rose, these things started to happen...
* * 1.Future profit worth less * *
Imagine how simple...
100 baht received today
It is worth more than 100 baht for years to come.
The higher the interest, the lower the market the value of "future profit."
Stocks whose prices rely on high future expectations like Growth stocks and AI stocks are therefore often affected first.
* * 2. Bonds are getting more attractive * *
When lower-risk assets yield higher returns, some investors may begin to question...
> "Why take risks with expensive stocks when bonds yield attractive returns?"
Some of the investment money may therefore flow out of Growth shares to lower-risk assets. 💵
* * 3.The cost of building AI is more expensive * *
The development of AI requires huge investment.
From chips, data centers, power, cloud systems to specialized personnel.
As interest rises, company capital costs rise.
So the market didn't just ask...
* * "How much do companies invest in AI?" * *
But starting to ask more important questions...
> * * "Can the money invested be turned back into profit soon enough?" * *
🔎 * * What investors should understand * *
Higher Bond Yield doesn't mean AI is over.
Nor does it mean that every AI stock has to fall.
But it is making the market * * tighter with expectations * *
From the original that just said,
"We are investing in AI."
The market may also be ready to give a higher share price.
But today, the company may have to prove that...
> * * Does AI really make money and profit worth the investment? * *
So what's important to investors is not just to ask...
* * "Is AI still growing?" * *
But should also ask...
> * * "How much does today's stock price reflect the future?" * *
Because a good company may not always be a good investment.
If we buy it at an exorbitant price,
Follow * * Future Money Rise * *
We will gradually simplify the investment. 🌱
* This material is made for educational purposes, not advice on buying or selling securities. *