{"id":3382,"date":"2025-10-20T08:00:01","date_gmt":"2025-10-20T08:00:01","guid":{"rendered":"https:\/\/advisor.wellington-altus.ca\/evansfamilywealth\/?p=3382"},"modified":"2025-12-18T16:04:10","modified_gmt":"2025-12-18T16:04:10","slug":"ai-investing-insights","status":"publish","type":"post","link":"https:\/\/advisor.wellington-altus.ca\/evansfamilywealth\/ai-investing-insights\/","title":{"rendered":"Good News! The AI Era is Changing How We Invest"},"content":{"rendered":"

We celebrated our Growing Together luncheon last week at the beautiful Aquatopia Conservatory, in Carp. It’s always a delight to see our clients chatting together and so much fun to share time together. Of course, not everyone could make it and we don’t want anyone to feel left out! So for those of you who were unable to attend, we’ve attached a link to the video and provide a brief summary of the keynote below.<\/p>\n

\"Evans<\/p>\n

Front Row Seats to a Revolution<\/strong><\/span><\/h2>\n

Three years ago in San Francisco, OpenAI released ChatGPT. That spark has been fanned into a fire and is racing from industry to industry, and shows no sign of slowing. We now have front-row seats to the most consequential technological revolution in living memory.<\/p>\n

A Library of Human Intelligence: How Fast AI is Evolving<\/strong><\/span><\/h2>\n

To grasp the scale, imagine a library that holds the entire corpus of human intelligence (everything written for the past 6000 years). Now picture adding two more libraries next year, and sixteen more shortly after, not by photocopying what\u2019s already on the shelves, but by generating new insights, proofs, code, designs, and therapies. That is what modern AI systems are doing as they learn to reason, not just autocomplete. The shelves aren\u2019t filling linearly; they\u2019re inflecting higher. Imagine the discoveries that will be made!<\/p>\n

The Rails\u2014and the Towns That Follow: Investing in Infrastructure<\/strong><\/span><\/h2>\n

Like Canada\u2019s railway boom, the biggest fortunes weren\u2019t made in the steel alone but in what the rails enabled: grain elevators, ports, mining, hotels, banks, and insurers. AI is our generation\u2019s railway. The point isn\u2019t simply \u201cmore tech stocks.\u201d It\u2019s that infrastructure creates entire ecosystems\u2014and productivity gains compound across the real economy.<\/p>\n

The Three Floors of the AI Economy<\/strong><\/span><\/h2>\n

We structure our investing around a three-floor building:<\/p>\n

    \n
  • Basement (Infrastructure): Power plants, upgraded grids, and the shells of data centers the size of small cities. This is the physical bedrock that keeps the lights on and the servers humming.<\/li>\n
  • Main Floor (Compute): The racks of GPUs and the hyperscalers (Microsoft, Amazon, Meta, Google) turning electrons into intelligence output. Cash-gushing businesses funding this buildout largely from operating cash flow.<\/li>\n
  • Second Floor (Operating Leverage): Incumbent banks, utilities, telcos, manufacturers, health systems\u2014everyday businesses that wield AI to cut costs, raise throughput, and lift margins. This is where broad-based productivity growth shows up in earnings\u2014and ultimately in GDP.<\/li>\n<\/ul>\n

    We invest across all three because, as with the railway, the interconnections create the value.<\/p>\n

    Why This Isn\u2019t a Bubble (Yet)<\/strong><\/span><\/h2>\n

    We\u2019ve lived through manias and crashes. What\u2019s different today?<\/p>\n

    Real cash, not easy equity. Hyperscalers are funding buildouts from cash flow, not from waves of fragile IPOs.<\/p>\n

    Earnings follow the capex. When infrastructure delivers usable intelligence, unit costs fall, adoption accelerates, and profits expand\u2014especially on the second floor.<\/p>\n

    We remain vigilant on valuation and risk management. But based on today\u2019s evidence, we are not seeing the classic signs of a late-stage bubble.<\/p>\n

    What This Means for Productivity and Portfolios<\/strong><\/span><\/h2>\n

    AI already handles a material share of professional tasks and is improving month by month. Seconds of compute gave us autocomplete; minutes to hours unlocked reasoning and digital agents; weeks to months will deliver frontier discoveries\u2014drug candidates, new materials, better designs. That\u2019s a recipe for a productivity shock: more done, more quickly for less. History suggests those gains accrue to well-positioned incumbents and the infrastructure that supports them.<\/p>\n

    Our Approach: Discipline, Diversification, and Disruption<\/strong><\/span><\/h2>\n

    Discipline: Own Basement + Main Floor + Second Floor\u2014not just the shiny parts.<\/p>\n

    Diversification: Balance growth with ballast. We pair growth exposures with gold, Bitcoin, commodities, and selected bonds\u2014not because we\u2019re gloomy, but because prudent people fasten their seat belts.<\/p>\n

    Disruption: We\u2019re evolving client portfolios bespoke to your goals and upgrading our own research stack with AI \u201cdigital employees\u201d that read transcripts, parse macro data, and track positioning\u2014so we can spend more time on judgment, conversations, and execution.<\/p>\n

    The Spirit Behind the Strategy<\/strong><\/span><\/h2>\n

    Our motto is simple and sincere: \u201cOur family, serving your family.\u201d Serving means telling you not just what\u2019s comfortable, but what we believe you need to hear so you don\u2019t miss the opportunity in front of us.<\/p>\n

    \u201cCynicism masquerades as wisdom, but is the furthest thing from it\u2026 cynicism is self-imposed blindness.\u201d \u2014Stephen Colbert<\/p>\n

    We refuse to turn a blind eye to this opportunity. We intend to be prepared.<\/p>\n

    Watch the Talk (and Share It)<\/strong><\/span><\/h2>\n