This seems like a very surprising claim to me. You can make money on stocks by knowing things above pure chance. Do you really think that P(stock rises|AGI)≈P(stock rises) for all stocks?
Your question ignores timeframes. I’m happy to argue that P(stock rises in the next 5 years |AGI in 20 years)≈P(stock rises in the next 5 years) for all stocks.
I’m a professional equity investor, and trust me, the market isn’t that forward-looking. Unless you believe in AGI within the next 10 years, I suggest ignoring it when it comes to picking investments. Because for the intermediate timeframe until the market begins to take the concept seriously, the value of your investments will be determined by all the other factors which you’re ignoring in favour of focusing on AGI, so unless you want your investment results to be meh for years-to-decades, then don‘t go for some all-out bet on AI.
Because for the intermediate timeframe until the market begins to take the concept seriously, the value of your investments will be determined by all the other factors which you’re ignoring in favour of focusing on AGI, so unless you want your investment results to be meh for years-to-decades, then don‘t go for some all-out bet on AI.
For most people here, the choice is not between choosing AI stocks based on fundamental value, and choosing another set of stocks based on fundamental value. Rather, it’s between choosing AI stocks based on their fundamental value, and choosing an index fund. If we assume that whatever short term variables affect AI stocks are just as unpredictable as those that affect index funds, the only real risk to investing in AI stocks is that you might not be diversified enough.
In other words, the main argument against investing in AI stocks (conditional on AGI being a real force later this century), is that you don’t want to expose yourself to that much risk. But plenty of people are OK with that level of risk, so I don’t see a problem with it.
The question is not if you can build a portfolio where the expected gains conditional on AGI is positive, it’s whether you can get enough of an advantage that it outweighs the costs of doing so, and in expectation outperforms the obvious alternative strategy of index funds. If you’re purely risk-neutral, this is somewhat easier. Otherwise, the portfolio benefits of reducing probability of losses are hard to beat.
You also may have cases where P(stock rises | AGI by date X)>>P(Stock rises), but P(stock falls | ~AGI by date X) is high enough not to be worthwhile.
This seems like a very surprising claim to me. You can make money on stocks by knowing things above pure chance. Do you really think that P(stock rises|AGI)≈P(stock rises) for all stocks?
Your question ignores timeframes. I’m happy to argue that P(stock rises in the next 5 years |AGI in 20 years)≈P(stock rises in the next 5 years) for all stocks.
I’m a professional equity investor, and trust me, the market isn’t that forward-looking. Unless you believe in AGI within the next 10 years, I suggest ignoring it when it comes to picking investments. Because for the intermediate timeframe until the market begins to take the concept seriously, the value of your investments will be determined by all the other factors which you’re ignoring in favour of focusing on AGI, so unless you want your investment results to be meh for years-to-decades, then don‘t go for some all-out bet on AI.
For most people here, the choice is not between choosing AI stocks based on fundamental value, and choosing another set of stocks based on fundamental value. Rather, it’s between choosing AI stocks based on their fundamental value, and choosing an index fund. If we assume that whatever short term variables affect AI stocks are just as unpredictable as those that affect index funds, the only real risk to investing in AI stocks is that you might not be diversified enough.
In other words, the main argument against investing in AI stocks (conditional on AGI being a real force later this century), is that you don’t want to expose yourself to that much risk. But plenty of people are OK with that level of risk, so I don’t see a problem with it.
The question is not if you can build a portfolio where the expected gains conditional on AGI is positive, it’s whether you can get enough of an advantage that it outweighs the costs of doing so, and in expectation outperforms the obvious alternative strategy of index funds. If you’re purely risk-neutral, this is somewhat easier. Otherwise, the portfolio benefits of reducing probability of losses are hard to beat.
You also may have cases where P(stock rises | AGI by date X)>>P(Stock rises), but P(stock falls | ~AGI by date X) is high enough not to be worthwhile.