Key Points
- Global investors are shifting funds to Chinese AI to avoid expensive U.S. stocks.
- China is fast-tracking IPOs for domestic chipmakers to achieve tech independence.
- New Chinese AI companies have seen stock prices surge up to 700% upon listing.
- Major players such as Alibaba and Tencent are becoming major players in the AI chip market.
Global investors are starting to look past Wall Street for the next big win in artificial intelligence. While U.S. tech giants like Nvidia and Microsoft dominate the headlines, their stock prices have become very expensive. This has raised concerns about a speculative bubble. To protect themselves, many fund managers are moving money into Chinese AI companies, betting that the gap between U.S. and Chinese technology is closing fast.
China is currently pushing for “tech independence” as trade wars with the U.S. continue. As a result, Beijing is expediting the public listings of its own chipmakers. Two companies, Moore Threads and MetaX, recently debuted on the stock market with massive success. MetaX, for instance, saw its stock price jump 700% on its very first day of trading. These companies are often referred to as “China’s Nvidia” because they aim to develop the hardware that powers AI.
Large investment firms are also changing their strategies. Some U.K.-based managers report intentionally limiting their exposure to the “Magnificent Seven” U.S. tech stocks. Instead, they are buying shares in Chinese companies such as Alibaba and Baidu.
Alibaba is no longer just an e-commerce company; it now runs a major AI chip unit and owns one of the world’s most popular large language models.
Ironically, U.S. trade restrictions have actually helped these Chinese firms. By blocking China from buying the best American chips, the U.S. forced Chinese companies to invent their own technology from scratch. This “emergency” has created a huge opportunity for investors who want to diversify their portfolios.
New investment funds are emerging on the Nasdaq that give Westerners a way to invest in “the Chinese versions of Google and OpenAI.”
Still, some experts urge caution. They warn that many of these new chip companies are currently driven by hype rather than actual profits. While the growth is impressive, the risk of a different kind of bubble in China remains. Even so, the trend is clear: many investors believe that a prudent strategy involves owning a stake in the AI race in both the East and the West.
