October was another tough month for the AI trade. The SOX index fell for eight consecutive sessions, its longest losing streak since 2008. At one point, the index was down 16% MTD.
An exceptionally strong quarter from SK Hynix and Anthropic’s IPO filing sparked a brief rebound, but the gains didn’t last. Disappointing results from Intel and Amazon sent chips lower again, and the iShares Semiconductor ETF closed the month down 17%.
The simple truth is that the AI trade has pushed volatility to levels we haven’t seen since COVID. Take Meta, one of the world’s largest companies: its stock has swung 20% or more eight times in the past year. While this is great for volatility traders, it makes the stock hard for long-term investors to hold.
Now, let’s look at how the MS portfolio has performed. In October, our portfolio was down 13%, slightly better than SOXX, bringing our YTD performance to 45.03%.
We have a lot to update, since most of our holdings reported earnings in the past two weeks.
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