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  • Stonks: $XLK rebalance, $SPXL hold, AI boom, $AMD bull, $DELL xAI

Stonks: $XLK rebalance, $SPXL hold, AI boom, $AMD bull, $DELL xAI

Author

Michael Luo
June 20, 2024

Here’s the latest “under the radar” stock news from Reddit in the last 24 hours that you don’t want to miss, as picked by Fluid Bot’s AI.

Why hold SPY, when you can hold SPXL? (That's SPY but 3x leveraged) 

  • Leveraged ETFs like $SPXL are not necessarily a 'wealth destroyer'

  • Simulated data shows SPXL has been reliable and outgrown $SPY over the long term

  • Investing in SPXL could potentially result in a 10x return every 16-18 years

Most stocks hyped as winners from AI boom have fallen this year

  • Reddit sentiment: mixed/positive (comments appreciating moat, convenience, and potential as an investment. Some concerns but still see investment opportunities in partnership with Apple)

  • Stocks related to artificial intelligence (AI) that were popular last year have experienced declines this year, indicating investors are becoming more discerning.

  • Many companies claiming to benefit from the AI trend are facing scrutiny from investors who want to see evidence supporting their claims.

  • While the S&P 500 has seen gains this year, stocks in the "AI Winners Basket" have declined.

  • Investment funds focusing on AI beneficiaries have also experienced declines in their stock holdings.

  • Companies like Nvidia, which have shown strong revenue growth and delivered results, have seen significant stock value increases.

  • Tech companies like Salesforce, Snowflake, Intel, and Adobe have seen drops in stock prices after initially strong gains.

  • Some experts believe the AI-related rally may still resemble a bubble, with smaller players fading before larger ones being affected.

AMD bull case. 

  • Massive bull case for $AMD this year

  • Xilinx acquisition will help improve software to compete with Nvidia

  • Lisa Su focusing on catching up, releasing GPUs yearly to match Nvidia's schedule

  • Expected increase in AI revenue guidance, currently at 4 billion

  • Supply ready to deliver significantly more revenue if demand is there

  • Meta and Microsoft confirmed buyers

  • Prediction of stock going back up to 200 by end of year

  • Caution against solely chasing after $NVDA

Dell is Building a Monstrous AI Factory Powered by NVDA for Elon’s xAI 

  • Author is not a fan of Elon Musk, suggesting buying calls for $NVDA

  • Dell reportedly opening an AI Factory called XAI

  • Author has $156k worth of leaps in stock positions to collect earnings and mentions precious berr tears

  • Dell is building a massive AI factory powered by Nvidia for Elon Musk's xAI outfit

  • They are using Nvidia's latest GPUs to train future iterations of xAI's Grok model

  • xAI is going all-in on an AI training arms race, utilizing 100k Nvidia H100 tensor core GPUs

  • Dell and Nvidia partnership aims to provide heavy-duty compute muscle for xAI

  • The scale and specs of the AI factory are unknown, but it is likely to be one of the most powerful supercomputers ever conceived

  • The big question is whether xAI can match the technical prowess and cost-effectiveness of cloud training solutions offered by Amazon, Microsoft, and Google.

Rebalancing taking effect this 6/21.

  • Large XLK ETF with $72 billion in assets buying $10 billion of $NVDA shares after market closing on 6/21

  • Forced selling of $11 billion of $AAPL shares and forced buying of $10 billion of $NVDA shares

  • XLK currently holds 22% of $AAPL and may reduce down to 4%

  • XLK currently holds 5.90% of $NVDA and may increase to 22%

  • Apple cannot prevent this rebalancing

  • Expect significant movement in both stocks on Monday pre-market (6/24)