"With the broad basket of Chinese internet stocks marching higher again, investors may wish to give the forgotten names a second look for their newfound momentum and intriguing new AI developments. Undoubtedly, the price of admission to the AI boom is getting a bit high in the U.S. market. And while America's AI lead is likely to hold up, I still think it's a wise idea for investors looking to bet on the transformative, even revolutionary trend to consider diversifying internationally."
"Undoubtedly, there are far lower valuations and the potential for surprises (think DeepSeek) as China looks to play catch-up in its own AI race. Additionally, with the Chinese government likely only to give the green light to domestic AI models while shutting out just about everything else, I think there's a strong case for nibbling on a few of the Chinese tech giants as we move further into the AI age."
U.S. AI stocks carry high prices, making international diversification attractive for investors seeking AI exposure. China offers lower valuations and the potential for surprises as it attempts to catch up in AI. The Chinese government is likely to approve domestic AI models while excluding many foreign models, strengthening the case for Chinese tech giants. Alibaba fell over 76% at its worst but has recovered, rising about 94% year to date, and is advancing AI with its Qwen model and heavy investment in AI chips. Investors could consider initiating small, gradual positions in select Chinese internet names.
Read at 24/7 Wall St.
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