Betting on the future: 3 AI stocks I’ve gone ‘all in’ on

Edward Sheldon has built up large positions in these AI stocks as he feels that they’re going to be good investments in the long run.

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Artificial intelligence (AI) stocks have been flying this year and for good reason. Over the next decade, AI technology is going to disrupt pretty much every industry.

Currently, I’m invested in a lot of companies that offer exposure to the artificial intelligence theme. But here’s a look at three AI stocks I’ve gone ‘all in’ on.

Alphabet

Let’s start with Google and YouTube owner Alphabet (NASDAQ: GOOG). It’s currently my largest individual stock holding overall so it’s fair to say that I’m making a pretty big bet on the company.

Alphabet has always been a leader in the AI space and I expect it to benefit from the technology in many ways in the coming years.

Looking ahead, we’re likely to see AI further integrated into products like Gmail, Google Drive, and Google Maps. As a user of these services, I’m excited. Already, Gmail’s AI technology saves me a lot of time writing emails.

Of course, AI could also have a negative impact on Google’s search business. After all, a lot of people are using ChatGPT and other large language models (LLMs) to find information these days. So, we could see search revenues decline in the years ahead.

But Alphabet has its own LLM, Gemini (which I’ve attached a screenshot of below showing the company being very bullish on its prospects). I believe that people will still use Google alongside LLMs. For specific searches, LLMs aren’t (yet) very useful.

Nvidia

Next, we have Nvidia (NASDAQ: NVDA), which is currently my fifth-largest stockholding.

The way I see it, Nvidia is the most important company in the entire artificial intelligence ecosystem. That’s because it designs high-powered computer chips that make AI possible (AI uses an enormous amount of computing power).

Today, pretty much every big technology company (Alphabet, Microsoft, Meta, etc) is buying a truckload of Nvidia chips to power their AI applications. Without Nvidia’s products, we wouldn’t be seeing AI services like ChatGPT and Gemini.

Now, while Nvidia is a leader in the AI chip space, a risk is competition from rivals such as AMD (in which I’m considering investing). We may see other players capture market share in the years ahead.

I’m backing it to continue to dominate the AI chip market, however. Not only does Nvidia have a visionary CEO but it also spends a ton of money on R&D to stay ahead of the competition.

London Stock Exchange Group

Finally, we have London Stock Exchange Group (LSE: LSEG) or ‘LSEG’ for short. It’s currently my eighth-largest holding.

Now this company may not seem like an AI play. But it’s quite active in the space.

You see, LSEG recently signed a partnership with tech giant Microsoft (which is a part-owner of ChatGPT). As a result, the group is shortly about to launch a bunch of exciting new AI features on the data side of its business.

In the company’s recent Q1 earnings call, CEO David Schwimmer noted that the group is using AI in other ways too. For example, it has developed its own internal LLM to make its customer service team more efficient.

A key risk with LSEG is financial market weakness. This could lead to a decrease in trading activity across its exchange. Other risks include regulatory scrutiny, competition from rivals, and technology disruption.

Taking a long-term view, however, I’m confident this stock can go higher.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Ed Sheldon has positions in Alphabet, London Stock Exchange Group Plc, Microsoft, and Nvidia. The Motley Fool UK has recommended Advanced Micro Devices, Alphabet, Meta Platforms, Microsoft, and Nvidia. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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