DBS Chief Investment Officer: Nvidia's Valuation is Low, AI Stocks are Not in a Bubble

DBS Group's Chief Investment Officer Hou Wey Fook stated that Nvidia's price-to-earnings ratio and the expected 70% profit growth next year indicate that technology stocks driven by artificial intelligence are still far from being in a bubble. Currently, Nvidia's forward price-to-earnings ratio is 17 times. Hou compared this to Cisco Systems' valuation of about 100 times before the internet bubble burst. He pointed out that as a representative company in the field of artificial intelligence, Nvidia's price-to-earnings ratio is only in the teens, which cannot be considered a bubble. Hou also mentioned that there are still tailwinds for investments in semiconductors and artificial intelligence. He suggested adopting a barbell strategy to control the overall volatility of the investment portfolio, allocating technology stocks on the growth side while pairing them with investment-grade fixed income assets to provide stable returns, and using hedge funds and gold as intermediate risk diversification tools.

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