Billionaire Ken Fisher, the founder of Fisher Investments, believes that high-quality growth is the key to investing in artificial intelligence (AI). As the AI market continues to experience a gold rush among investors, Fisher’s biggest holdings reflect his confidence in the potential of AI.
Last year was marked by one of the worst stock market declines in Wall Street history, with major market indexes plunging into bear market territory. However, 2023 has started on a more positive note, with these indexes rebounding over 20% from their lows. This recovery can be attributed to recent advances in the field of AI, which have captured the attention of Wall Street and Main Street alike.
Ken Fisher is a prominent figure in the investment world, having founded Fisher Investments in 1979. His firm manages assets worth $211 billion, and he is also known for his long-running Portfolio Strategy column in Forbes. Given his expertise and success, when Fisher speaks, investors listen.
Some investors have raised concerns about whether the rapid rise of AI-related stocks indicates an AI bubble. However, Fisher downplays this notion and emphasizes that the surge in technology stocks is primarily driven by quality growth and the rebound from the market decline in 2022.
According to Fisher, it’s not just small startups in Silicon Valley driving AI; it’s the industry giants involved in chips, software, data analytics, and search. While AI exposure can be beneficial, Fisher believes intelligent investing means focusing on high-quality growth, with AI being a potential driver of that growth.
Looking at Fisher’s diversified holdings, it becomes evident that two AI stocks dominate his portfolio. Fisher Asset Management holds around 52.35 million shares of Apple, valued at approximately $10 billion, making it his top holding. Apple’s consistent quality growth over the past decade has contributed to its impressive financial performance, with its stock growing over 1,170% and the company becoming the first to surpass a $3 trillion market cap.
Microsoft is Fisher’s second-largest holding, with around 24.46 million shares valued at over $8.2 billion. Like Apple, Microsoft has also shown consistent quality growth, with its revenue growing by 185% and its stock surging over 894% in the past decade. The company has made significant strides in integrating AI into its products, such as its Bing search engine and its plans to make AI widely available through its Azure cloud.
Investors might question investing in Apple and Microsoft, considering their already massive market capitalizations. However, analysts believe these companies still have room for further growth. Wedbush analyst Dan Ives predicts that Apple could be worth $4 trillion by 2025, while Microsoft could join Apple in the $3 trillion club in early 2023.
The market’s outlook on the value of AI varies, with estimates ranging from $6 trillion to $7 trillion by the end of the decade. Considering the vast implications and potential use cases for AI, companies that successfully harness this technology could experience even greater growth. For investors seeking quality growth, AI-focused stocks like Apple and Microsoft may present lucrative opportunities.
Overall, Ken Fisher’s investment strategy emphasizes the importance of high-quality growth when investing in AI. By holding significant stakes in Apple and Microsoft, Fisher demonstrates his confidence in these companies’ ability to capitalize on the AI revolution. As the AI market continues to evolve, investors would do well to pay attention to the opportunities presented by these industry leaders.
