TSM
Taiwan Semiconductor Manufacturing Company Ltd.
stock NYSE ADR

The one risk for growth names in AI adjacent companies was capex might slow. Google and TSM said “lmao absolutely not, we’re spending more through 2027” and yet all of those stocks are getting obliterated.

AI names getting nuked because…. Google and TSM said AI capex is only going to go up through 2027. And then Jensen defended compute demand… so neoclouds all fall. Alright.

The semi trade HAS to have washed out a lot of people by now, tired of the 2 full months of chops, rug pulls, and counter narratives.
Don't think more blowout earnings will save positions. Stuff like $TSM and even $GOOG lately shows market still doesn't give a shit.

Listen folks, I'm not a tech bro and I know nothing about this AI stuff. I don't care how it works, it's just hype and buzzwords for me. However, I've never made so much easy money in my life and I wanted to share a few insights on how I did it.
My strategy for the past 3 years has been to invest in a company as soon as they use the word AI in their brand. This has worked very well for me and a few of my friends across several stocks. For example, as soon as Intel has rebranded to "Built for AI", we knew that it was about to skyrocket, and sure enough, the green candles started to show up in the next weeks.
It worked so well that I've created an index called the Frequency AI Ratio Tracker (FART). It's basically the amount of time the word "AI" is used on a company's homepage. For example, AMD currently has 60 occurrences of the word "AI" on their homepage for roughly 876 words in total, meaning a ratio of 6.85%.
To put that in perspective: statistically, 1 out of every 15 words on AMD's homepage is "AI". That is a **critical-level**, enterprise-grade FART score and it was a no-brainer once I discovered that out. The higher the score is, the greater the potential was.
However, for the first time in the past 3 years, I have a strange feeling that this strategy is no longer working and the momentum is starting to fade away. Looking at all the OG companies from the .com bubble, it sure looks like a peak to me, and I've actually started to use a reversed-FART strategy since July 4th. The higher the score is, the greater the risk of a downfall once the AI bubble pops.
[Some OG stocks](https://preview.redd.it/yqpbos7uo7fh1.png?width=1080&format=png&auto=webp&s=40823c3fb4c3a05d4f200f85395622ed3ece69ae)
The General Rule of Thumb for the reversed-FART stategy:
0%: Low risk
0.1% – 2%: Medium risk
2% – 5%: High risk
> 5%: Extreme risk
Here's the most recent compiled version of FART for some tech companies as of July 24th.
==========================================================================
Name of company | Stock | Total Words | AI Mentions | FART Score
==========================================================================
AMD | AMD | 876 | 60 | 6.85 %
NVIDIA | NVDA | 2663 | 115 | 4.32 %
Oracle | ORCL | 786 | 27 | 3.44 %
ServiceNow | NOW | 651 | 22 | 3.38 %
Qualcomm | QCOM | 765 | 24 | 3.14 %
Arm Holdings | ARM | 862 | 26 | 3.02 %
Cisco Systems | CSCO | 450 | 13 | 2.89 %
SAP | SAP | 1004 | 25 | 2.49 %
IBM | IBM | 560 | 11 | 1.96 %
Micron Technology | MU | 635 | 12 | 1.89 %
Microsoft | MSFT | 645 | 10 | 1.55 %
Broadcom | AVGO | 462 | 7 | 1.52 %
Salesforce | CRM | 936 | 14 | 1.50 %
Samsung Electronics | 005930.KS| 375 | 5 | 1.33 %
Meta Platforms | META | 303 | 4 | 1.32 %
Alphabet (Google) | GOOGL | 422 | 4 | 0.95 %
TSMC | TSM | 688 | 6 | 0.87 %
Intel | INTC | 245 | 2 | 0.82 %
Palantir | PLTR | 3151 | 23 | 0.73 %
SK Hynix | 000660.KS| 167 | 1 | 0.60 %
Amazon | AMZN | 355 | 2 | 0.56 %
Applied Materials | AMAT | 209 | 1 | 0.48 %
ASML | ASML | 596 | 1 | 0.17 %
Corning | GLW | 576 | 1 | 0.17 %
Apple | AAPL | 883 | 1 | 0.11 %
Tesla | TSLA | 181 | 0 | 0.00 %
Lam Research | LRCX | 275 | 0 | 0.00 %
*Legal notice: I am dumb and this is not financial advise. This was compiled by hand by copy-pasting in Microsoft Word like a fool and searching for the word AI. Consider compiling your own data and use FART at your own risk. I am not responsable for any loss based on this strategy. The level of risk estimated by FART was established out of thin air. Ask your financial adviser about FART.*

I'm down on my semi stocks which I'm bitter about as its ~50% of my small portfolio I play with. Fuck you TSM & ASYS.
most of my other holding are bounching between 2% positive or negative max....think finance and super short term risky shit.
My manufacturing stocks, all except AA are green and a positive return.
I had cash sitting in a fidelity position...then realized it would be better sitting in a diversified international market. FZILX was my global (read international and less exposure to the AI bubble and diversified from US markets.) It also is a 0 expense no transaction fee index fund.
Downside of FZILX is that Samsung and SK Hynix are being held. That said....I think if a position shits the bed they drop it....I'm no Michael burry when it comes to research thought.
DD: moved cash into international index fund with 0 expense or transaction fees. Hoping to get better rates than a cash position and a decent market return.

The one question causing AI infrastructure names to crash this month was capex from mag 7 slowing, Google and TSM it’s only going up through 2027, so they sell off even more? What the fuck even is this market anymore.

Yeah I guess I'm stuck bag holding my TSM & ASYS positions till they finally print green instead of red.
Go figure my two biggest positions are fucking my portfolio red hard.
That said my AA stock position (got in at 49.5) is so red that I just want to see it go green even if its not large a position of my total portfolio.
I have a rule: buy low sell high and this market seems to like making that fucking impossible if I never return to break even or go net positive.
Attaching obligatory photo.
https://preview.redd.it/dgfx37qmz6fh1.jpeg?width=320&format=pjpg&auto=webp&s=71e070da65f734bf4b6fa0c873f21016d99cd986

Good points. Right now the shovel providers are benefiting. But if the diggers drastically slow down or stop spending, then the reverse will happen. Hence, not every stock involved in all facets of the AI trade will be going up together now because of the multi-faceted risks. Where are the risks. Right now the diggers spending too much and not getting an ROI on those investments.

The risks for the shovel providers are the diggers slowing down or stopping.

But the other risk I keep in back of my mind is china invading taiwan which would affect TSM. That would kill the AI trade! It's lower risk then it was one or two years ago but it's still there. TSM and other manufacturers building plants outside of taiwan is a great contingency but we have years before those plants are ready.

AMZN is my hedge. I'm rolling the dice on AVGO VS TSM. Someone say it for me. The bank is ready.

Yeah I remember looking at TSM at a number and being like that doesn’t make sense and I had to audit the whole thing. Now I just use a stock MCP and the AI doesn’t hallucinate anymore

TSM reported 1T in monopoly money. But only $40B in USD.

|Name|Symbol|Shares|Price|Average Cost|Equity|
|:-|:-|:-|:-|:-|:-|
|Taiwan Semiconductor Manufacturing|TSM|10.073|$414.80|$255.65|$4,178.12|
|Broadcom|AVGO|21.061|$392.77|$349.03|$8,272.13|
|Alphabet Class A|GOOGL|16.019|$319.40|$276.88|$5,116.44|
|Goldman Sachs|GS|2.008|$1,075.63|$829.35|$2,160.39|
|General Electric|GE|10.008|$348.87|$300.41|$3,491.58|
|Amazon|AMZN|25|$234.78|$218.71|$5,869.49|
|NVIDIA|NVDA|20.024|$208.04|$194.44|$4,165.83|
|GE Vernova|GEV|4.502|$1,028.50|$972.68|$4,629.85|
|Microsoft|MSFT|10|$383.15|$364.80|$3,831.50|
|Ferrovial SE|FER|20|$63.30|$63.16|$1,266.00|
|S&P Global|SPGI|10.049|$420.00|$425.56|$4,220.42|
|Northrop Grumman|NOC|5.023|$533.48|$577.54|$2,679.69|
|**Total stocks and options**|||||**$49,881.43**|
**CASH:** \~**$10,000**

Discussion:
I bought GOOGL around $180, but recently I nearly doubled my position again in the low $300s. I am trying to figure out what makes the most sense between PWR, FER, HONA, META as big addition to my portfolio.
Ferrovial: high quality physical infrastructure mixture of toll roads, airports, CE services, electrical infrastructure. Physical infrastructure is one of the most overlooked moats. The assets like toll roads or airports are effective monopolies with wide moat, because direct competition would be financial suicide with high level of predictable cash flows with pricing power greater than inflation. Exciting projects concessions like toll roads (I-24 and I-285) and NTO (JFK Terminal One) can be resilient cash flows compounders into the future to acquire more high quality assets. I consider adding this stock, because I would be comfortable holding it 20+ years.
HONA: At $195 this morning, it just seem a bit cheap for a wide moat industrial. Before, we make comparison to GE Aerospace spinoff, it is obvious that this company is nowhere near the level of quality as GE. However, it is still a high quality wide moat player in aviation especially the APUs with similar business model as GE.
PWR: Electrification grid expansion similar tailwinds to GE Vernova, but GEV can substantially benefit because it can create energy source independent from the grid avoiding pushback of rising bills by local. Record backlog with high visibility, and provider of blue collar services that are high demand like electricians.
META: I agree that META has visible tailwinds that are attractive like rising revenues for core services from AI to Meta Cloud business that can be quite lucrative. I am bearish on LLM viewing it as a commodity with low margin and no pricing power and switch cost. With this view, I would lean towards Amazon and Microsoft as they do not have significant LLMs investment compared to Google and Meta. Since, I already have much success with Google, I lean towards the view that Google is a higher quality company with cleaner execution and positioning in the AI race.

Nope. TSM PE Is 31 forward is 27. SKHY PE is 21 forward is 7.

TSM

it's a good idea to learn! my 0.02 is to learn as much as you can and pick one yourself. asking here is a good start to get some ideas of things to look at, but it's fun to find other unique ideas you come up with too.
i'd usually say Google is my favourite company but i havent caught up fully on their latest earnings report myself, so i dont want to say "i like google as an investment right now" because idk if i do or not yet.
same goes for some of my other favourite highly-valued stocks like TSM or AVGO. not sure what the current market's sentiment is yet myself.
a decent starting point might be to go over some of the biggest MC companies and learn about them, and how to read 10ks/earnings reports. that can help build a decent foundation to learn, and try to seek out learning materials / ask chat for a framework

time to buy NVDA and TSM

GOOG, TSM, AMD, AVGO.

Agree. If time horizon was larger than probably a good investment. But if you do buy, wait for bigger dips even though we're in one now it can go lower.

Another thing to keep in mind is that companies like ASML, TSM, AMAT, etc will be the early signals when this AI boom starts to cool down. If the COMPUTE need and data center buildout slows down, then these are the first companies that will see their sales demand begin to slow down or even go lower.

SpaceX datacenters are the biggest wildcard to me. If they can really pull this off, we have several more years to go in this AI boom. Elon Musk has accomplished things in past that nobody ever thought could be done; e.g., let's reuse rockets instead of making them for one-time (billion dollar) use space missions.

AMD, MU, TSM all defending highest 1w support levels

buy TSM