The stock market has apparently contained non-AI companies this entire time. Journalists are treating this like it's a archaeological find. They're not wrong.
Retail traders spent three years chasing anything with "neural network" in the investor deck. They bought semiconductor manufacturers. They bought cloud providers. They bought a company that makes cafeteria equipment for tech campuses because someone on Reddit said the CEO once shook hands with Jensen Huang.
Now the diversification articles arrive. What else could you buy? The financial press phrases this question like a concerned parent asking their kid if maybe, just maybe, they'd like to try a vegetable.
Here's what technical analysis reveals about "broadening trades": absolutely nothing you couldn't have known by looking at a chart in 2019. Industrials exist. Consumer staples exist. Banks exist, though I'm not sure why. Energy stocks have been sitting there the whole time, posting earnings, doing buybacks, wondering if anyone planned to notice.
The thesis behind portfolio diversification is that you shouldn't put all your money in one sector. Groundbreaking stuff. Really earning that business degree.
But AI drove the market for three years, so naturally investors concluded that AI would drive the market forever. That's not recency bias. That's just being bad at this. The same people who bought Nvidia at $900 are now Googling "what is a utility stock" and feeling like Marco Polo.
The article suggests buying outside AI as if the rest of the market were some exotic frontier. It's not a frontier. It's the same boring shit that existed before ChatGPT convinced everyone the future would be different. The future is always the same. People need soap and electricity and someone has to make the soap and electricity and those companies have stock prices.
Diversification is what you do after you've already lost the money.
Photo by Maxim Hopman on Unsplash
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