Look who’s talking: Palm Capital, an owner-managed, long-term investment management firm that helps a few lucky clients preserve and grow their wealth. In a world where the financial industry often resembles a casino, these folks claim to be the serious players, investing in a handful of exceptional global businesses with the discipline of a yogi.
So, how are they doing? Over the three months ending 31 March 2023, their portfolio increased by a whopping 24.3% after management fees and trading expenses. Not too shabby, considering the MSCI World Index was left in the dust, trailing by a 0.3% per annum difference.
Last year, Generative AI strutted into the spotlight with the launch of DALL-E, Midjourney, Stable Diffusion, and finally, ChatGPT. It’s like a sci-fi movie come to life, minus the dystopian doom and gloom (for now, at least). ChatGPT, in particular, caused a stir probably because it let ordinary folks play with AI like a shiny new toy for the first time.
Now, let’s talk about Google. With a whopping 90% market share in search, the tech giant has become the eponym for the act itself (cue the “just Google it”chorus). But is Google Search quaking in its boots over the new kid on the block, ChatGPT, and the rise of Generative AI?
Palm Capital, being the savvy investors they are, look for businesses with durable competitive advantages helmed by exceptional managers. They bide their time, waiting to invest when the prices are less than what they think the businesses are worth, hoping to reap the benefits as these companies compound economic value over time. They only sell if the fundamentals deteriorate, or if they find other investments offering potentially better after-tax returns.
With all this in mind, the question remains: Will Google Search and Generative AI duke it out for dominance, or will they find a way to coexist in the ever-evolving tech landscape? Only time will tell, but one thing is for sure Palm Capital will be watching closely, ready to place their bets on the winners. […]