Get on board, the AI train is just about to leave the station, says fund manager
Artificial intelligence is just at the start of generating an entire ecosystem of innovative platforms and investors need to be ready to jump on the bandwagon, one fund manager says.
Nick Griffin, founding partner and chief investment officer of Melbourne-based investment manager Munro Partners, said the AI thematic had generated strong returns for Munroās funds in the past 12 months and he expected that to continue.
āWeāre effectively having an iPhone moment ā thatās what AI is, and thatās the best way to think about this,ā he told Nabtrade clients at an event at the ASX on Thursday.
Mr Griffin recalled how he first time he saw an iPhone, when a friend pulled his out and used the Shazam app to identify what song was playing at a bar.
āI told him, thatās the coolest thing Iāve ever seen ā I have to buy one of these,ā Mr Griffin said.
Apple created an app ecosystem that led to just about every company in the world creating an app for something, he said.
Some became huge companies, such as Uber, Spotify, Google and Facebook, and nearly everyone used apps to make their life easier, performing tasks such as online banking and checking in to airline flights, Mr Griffin said.
āGenerative AI is exactly the same thing ā whatās going to happen is that youāre going to see thousands of applications built on these large language models that are effectively going to make your life easier, and theyāre going to be across every industry on the planet,ā he said.
Mr Munro highlighted Adobeās Firefly app, which lets users easily transform photos, and Googleās Gemini, which among other things can watch and summarise YouTube videos.
Other applications were coming in everything from weather prediction to full self-driving cars to creating digital twins of physical objects for engineering purposes, he said.
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Mr Munro suggested that investors trying to ride this thematic look at the āpick and shovelā companies of the AI boom, such as cloud computing providers and semiconductor companies.
He said Munro firmly believed that AI chip maker Nvidia would become the most valuable company in the world.
Itās No.2, behind Apple and ahead of Microsoft, with a market capitalisation of $A7 trillion.
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