Here’s a preview of what we’ll cover this week: 

Macro: It’s a Hot Economy; Rate Cuts Are Off The Table

Markets: Do We Have An AI Bubble?; Early in The AI Economy; Micron’s 600% Move Is Justified; Smart Money Sees The Dislocation in Meta; Nvidia Has The Simplest Bull Case; Bill Buys Microsoft; Where To Find Ideas?

Lumida Curations: Neil Dutta: Blame Oil For Higher Rates; Anthropic’s CFO says the AI Race Is Over Compute Procurement

Q1 hedge fund filings were out this week.

The Lumida Invest app updates in real-time with latest filings, so you can see how smart hedge funds (and less smart hedge funds) are positioning.

We saw at the end of Q4 that many hedge funds had de-risked Mag 7 names. That was a timely signal as Mag 7 names like Microsoft, Meta, Google, and Nvidia sold off into a February correction.

Investing is social. People talk. People follow and copy trade, even the big guys!

Fun Fact: Renaissance Technologies increased their Micron position fourteen times in March 2026. It’s clearly a bet on Momentum, and another reason not to short stocks simply because they go up.

Moreover, you can also try the inverse-search. You can type in your favorite stock and see if smart money is buying, or if a big whale is selling.

Access the app here.

Select 13F Call Outs

Steve Cohen's Point72 initiated new positions in TSMC, and AMAT.

We like the TSMC idea. We’ve owned it for a while now. It’s a bottleneck whose valuation has not changed despite going up 100% in a year.

In our view, Point 72s 13F filings are consistently the most insightful and extend across a range of themes. They are worth a study in the Lumida invest app.

Within the theme, Berkshire bought Alphabet for the first time in his investing career after divesting substantial position in Apple. That makes sense.

The brief discount in Q1 actually made Google a good bargain – it was at ~23.6x P/E NTM on Mar 31.

We believe Google is an AI winner. However, we also believe you get a ‘market return’ here vs other names like Meta.

Cash-Flow Compounders

Bill Ackman made Microsoft a top-three position. It’s now roughly 16% of Pershing Square's portfolio.

This will be the third time Ackman has followed us one to three months later into a position - the others being Google and Meta.

Uber was another multi-fund add.

Ackman owns it as a top position. Brad Gerstner's Altimeter is in it. We bought Uber this Friday on technical and valuation grounds — industrials as a whole are over-priced.

But, Uber has relative value and let’s us maintain some exposure to the Industrials theme.

It’s helpful to ‘hedge’ your own views. I’m bearish on industrials, but this name offers opportunity relative to others.

Uber has high FCF yield, earnings growth, international expansion, market leadership, strategic partnership with Waymo, robotaxis and Nvidia. It’s hard to think of what goes wrong for Uber here. 

On Industrials, worth nothing that the XLI ETF has shown significant weakness even as other indicies hit all time highs last week. As you know, we’ve been flagging the risks around industrials for months.

I continue to get a phone call once a week from a non-professional investor that tells me about their special insight into a random industrial name. I’m not sure how many more top signals I need!

Why that matters?

Under the surface institutions are net sellers of industrials and net buyers of other categories.

The 3-month momentum on XLI is now negative. That’s not a great sign.

Momentum is a powerful force… but you need to be contrarian around inflection points.

Adobe sat in the same bucket - multiple hedge funds added it, including Paul Tudor, AQR, and Renaissance. We are on the same side of the quants. That happens often when we look at these 13Fs.

The stock has continued to produce earnings growth with consistent cash flows, while doomers think its headed to the ground. 

The FCF yield has never been higher. The fundamental business has double digit earnings growth and is growing users because they can’t switch it for AI. 

Here’s something interesting… Adobe went up 4% this past Friday even as popular momo names were down sharply on options expiration.

Software as a whole (see IGV) ETF also went up. The category is beating the S&P 500 over the last month.

It sure looks like the initial growth momentum rally is giving way to mean reversion now — much like we saw a few months after the Tariffmageddon correction ended.

We do believe Adobe has bottomed.

When shorts realize that software names no longer work as funding shorts, these should rally.

What The Smart Money Is Selling

Apple was trimmed across multiple funds. China exposure and higher memory prices an AI product gap is hurting the business. 

With memory prices going higher, iPhone prices would have to be raised, hurting demand, or absorbed hitting margins, both of which aren’t good for earnings. 

That said, the name has short-term momentum and it’s a retail market - it could run for a bit.

Consumer discretionary was also exited broadly — airlines, domestic consumer names, home goods. Notably, Berkshire picked up Delta. We like United. These names will rally when oil prices eventually come down or Mr. Market sees demand remains strong.

I’ll be doing a live stream later this week, analyzing the hedge funds in further detail.

You should subscribe to us on Youtube, and Spotify to make sure you don’t miss it. 

It took me a couple minutes to find what AQR, Renaissance, Druckenmiller, Buffett were buying in Q1.

If it weren’t for the Lumida invest app, It would have taken me hours scrolling each filing, and then, another hour processing the data.

Even worse, traditional advisors won’t even work on the 13F filings until Monday because they are off on the weekend. The clients will get this information after the market has already made the move.

How does this model not get disrupted?

Peter Thiel once said, What is something you know to be true that others disagree with?

It’s fairly obvious, isn’t it? AI will disrupt investing as we know. We are leading the charge.

I maintain it’s already the best investing app on the market… and it’s still in Beta.

We will be rolling out automated strategies soon. These are the same strategies we are using for idea generation, and we’ve incubated them with forward testing for quite some time now.

We are limiting the round size to people we know and people who know us. Given our robust pipeline, the round is attractively priced, and quite a bit cheaper than AI venture deal rounds.

Wealth management is a $140 trillion industry running on a 1970s business model.

There are a number of mega trends converging. It’s not just AI.

The next generation is set to inherit serious wealth. They don’t want a 60/40 portfolio. They don’t want an old school banker buying them U.S. Open Tickets.

They want an AI Avatar, community, and access to novel investment opportunities.

That is exactly what Lumida is building – the wealth manager for the future. 

We have already proven the model. Our revenues have grown at a CAGR of 300% since 2023, and the pipeline is as large as eve.

The Lumida crowdfunding campaign is live. And it is your chance to be part of the next wealth management revolution. 

Why crowdfunding and not a typical VC? Well, we do have VC general partners participating.

But, the big reason is Community. Look at the value Tesla, SoFi, Robinhood, and for that matter Bitcoin created. All of this was driven by Community.

Users became owners, and owners became users. Community is a real differentiator in a world of AI.

It’s wild that neither Robinhood, Schwab, nor Interactive Brokers have put forth an AI-native app experience. We’re coming for all that TAM. Investors deserve better.

Find all details here.

We wrote about the risk of increased inflation in January’s newsletter, titled ‘Run it Hot’. The data shows it clearly now. 

April CPI printed a 3.8% headline, and 2.8% core — the highest headline reading since May 2023.

Energy prices rose 18% year-over-year.

Nondurable goods — things like gasoline, food, household supplies — were up 7%.  

Oil at $107 per barrel is leaking into every corner of the economy, and it showed up in April's print.

However, there’s a silver lining in the data, and the reason why this is not another 2021-22.

The labor market is producing a downward impact on inflation. labor cost inflation fell to 1.2% YoY in Q1.

Output grew 3.3% while hours worked rose just 0.4%. Productivity is running faster than compensation.

In 2021–22, demand for labor significantly exceeded supply. Wage inflation ran hot. 

The oil shock and wage-price spiral reinforced each other in a feedback loop that took the Fed two years and 525 basis points to break. (Funny, how Trump can do the same before breakfast with a Truth Social post.)

Today, labor supply and demand are in equilibrium. 

The labor force sits at 178 million. Household employment plus job openings: 169.5 million. 

The gap that created 2021's wage explosion simply does not exist.

Interestingly, Trump’s reaction to the hot print was unlike what most expect from him. He pulled out all the stops to blunt what could have been a severe market decline on that news:

(i) waive beef tariffs

(ii) refuses to escalate despite IRGC firing at US destroyers

(iii) says ‘buy stocks’

(iv) previews China convo will be ‘positive’

Going into midterms, Trump is pivoting from aggression to conciliation.

At this point, Trump has more impact on markets than any other president in history.

We solve this with the “Trump Watch” feature in the Lumida Invest App. 

The ‘Trump Watch’ feature provides a 1 line summary on what Trump is saying, posting, or working on and it updates every few minutes.

Download the app here. 

Last few months have been solid for Lumida deals.

We completed our private raise for Shield, and it went up 30% in valuation right after the raise as the geopolitical tensions intensified.

And now, they have won a major defense contact with Taiwan.

I think that stock could have a Palantir like outcome in public markets.

The investment in Kraken shone as well. It was marked up to $20 Bn valuation this week on their latest funding round.

We got it at ~$12 Bn valuation last summer.

If you look closely, the bubble and value in private companies isn’t complicated to identify.

We are looking at Datacenter Energy theme right now.

Be sure to get on our list here if you are a qualified investor.

Note: We will share with you every deal we have done on request. No cherry picking.

These charts are worth scanning to get a sense of just how extraordinary the rally in QQQ and memory stocks has been.

Moreover, Goldman's High Beta Momentum Pair had its biggest single-day move in over five years this week. 

That kind of blow-off behavior is a sign that one should prepare for a rotation.

That is the largest 6-week return differential on record. It beats the ~19% differential at the peak of the dot-com bubble in March 2000.

The last two times we saw readings even close to this were May 2020 (coming out of COVID lows) and May 2025 (coming out of the Tariffmageddon lows). 

Both were snapback recoveries from genuine market dislocations like we had in this case.

But, once the rally was over, we saw a sharp mean reversion with capital spreading out. (we might be here, right now)

This week, we saw the first signs of the rotation starting. 

The SPHB/SPLV ratio — high beta versus low volatility stocks — had been cranking relentlessly higher as capital poured into semis and momentum names. 

We saw low volatility stocks outperform this week. Often you’ll get some headfakes before the trend shift sticks.

When money leaves industrials and semis and momentum, it has to go somewhere. 

And right now, "somewhere" is littered with quality businesses trading at prices that are quite cheap given their fundamentals.

The memory theme has sucked in so much capital from all other sectors, nearly every sector is trading cheap on absolute and relative multiples. The ‘higher for longer’ oil pricing and ‘higher for longer’ rates has also caused consumer discertionary names (think autos, cruiselines, and home builders) to trade cheap too.

Given that 2 out of 3 major risk barometers are at elevated levels, it is overall impressive to see the strength in the overall market.

Take a look at the disclocation across sectors.

The last time I recall seeing this was Nvidia from May through July 2024. That was about a 2 month opportunity.

Talking of opportunities, we see significant value in names like Broadridge, Medtronic, Docusign. We wrote about them last week. You can read our thesis here. 

The easy money in the momentum trade is behind us. The asymmetry has shifted to the names that got left behind.

Micron is up 660% in last 1Y with market cap crossing $800B this week. 

Retail investors are pouring in with full strength.

Micron's call option premiums topped the bullish flow charts at $990 million this week. It was double Nvidia’s at $494 million, and every other Mag 7 name.

If this was any other stock, one might call it a bubble about to pop, and safely get away with it.

In the case of MU, it is worth noting that the name is backed by earnings growth, which, by the way, surpasses the 660% increase in the share price. 

Participating in the AI theme makes sense rather than trying to short.

See how the change in blue line (EPS estimates) has stayed higher than the black line (share price).

Micron's 2027 adjusted EPS estimates are now up by 768%, which is the reason why the P/E is practically lower today than where it was a year earlier. 

A bubble is when prices run ahead of fundamentals.

This is fundamentals running ahead of prices. The market is chasing the earnings revision, and the revision keeps accelerating.

So is Micron a buy here?

We think it’s a hold.

If the name drops meaningfully, we expect it gets bought.

It’s also not worth chasing here either given the crowdedness and mania around it.

Not at all. 

A couple big differences:

(1) Today's capex spending is driven by the most profitable companies in the world, and increasingly by the government.

The spending is sustainable.

(2) The Dotcom era was truly nuts.

Example: http://TheGlobe.com went public in 1998.

It jumped 6X on its first day and nearly hit a billion market above $840M despite only about $5M in revenue.

The Dot Com bubble was also widely distributed. Krispy Kreme’s IPO went nuts.

We don’t see that here. Investors have much more discipline.

(3) There were social investing clubs, online message boards, and a much deeper sense of euphoria and an inevitability surrounding the promise of the internet.

(4) The dark fiber investment was unproductive during the DotCom era. This time, there isn't enough compute. 

(5) The Nasdaq went up 86% in 1999 before ending in a blow off top. 

We haven't seen a single year like that.

(6) Hyperscalers are seeing the value of inference. 

The future just isn't evenly distributed yet.

We're still early in the AI economy. 

We don't live in an AI economy.

We don't have AI assistants reliably processing email.

Vibecoding can't produce enterprise-grade software.

Driverless cars are still the exception.

Autonomous drone delivery isn’t here.

Medicine hasn’t been transformed.

No one has a humanoid walking their dog.

What is here?

The recognition that all of this is possible.

Refactoring a global economy takes time.

There still isn’t enough compute.

But there are enough proof points to keep the capital formation machines working.

That’s the phase we’re in:

Not the AI economy.

The financing of its inevitability.

Smart money is piling in Meta. 

Ken Griffin's Citadel added over a million shares of Meta in Q1— a 128% increase in their existing position. 

Steven Cohen of Point72, and Millennium Management also added significant sizes to their existing positions.

Even Ray Dalio — who has spent the better part of two years telling American equities are overpriced and the sovereign debt bubble is real — added 30% more Meta.

Meta trades at 18.5x forward earnings below the S&P 500 multiple.

The valuation is bonkers given how Meta has 3.4 B daily active users (who are so addicted that it might be dangerous), and 33% revenue growth.

Sure, they are spending a lot on CapEx. But they are doing it with metoeric revenue growth.

I came across an interesting interview of Meta’s chief AI officer, Alexander Wang.

His remarks suggest the upside on Meta might be more understated than we think.

He says the superlab rebuilt Meta's entire AI stack from the ground up in nine months and shipped Muse Spark — described as smarter and faster than anything Meta has released.

Zuckerberg's stated goal is personal superintelligence — AI that understands your world, built on the relationships and social context already at the center of 3.4 billion people's lives. 

That’s a clear mission, and it’s achievable.

Markets aren’t pricing Meta’s AI potential yet.

Nvidia reached all time highs this week with a new BAML report and a $300+ price target. 

Nvidia has 2x+ the earnings growth, margins, and revenue growth of AMD, which reported (rear view mirror now) while investors start anticipating Nvidia.

And, those earnings estimates on Nvidia might still not fully reflect upside expectations as analysts are revisiting their targets after the latest earnings season. 

For example: Morgan Stanley increased their AI capex targets this week to a high of $1.1T in 2026-27 due to rising cloud growth across hyperscalers. 

The chunk of this AI capex goes in buying chips that Nvidia has a 75% gross margin on - it’s that simple.

You also have the US President betting on your side.

A funny story…

I got a call from a friend this week pitching me Vertiv and various Industrials stocks. (I am keeping a log of these suggestion. At some point, these will become my go-to shorts.)

The argument centered on multi-year backlogs. 

(Note: I used to own Vertiv and these industrials back in the day. My observation is they failed to hit ATHs, are expensive and crowded.)

When I brought up Nvidia the response was ‘Well, we don’t know their revenue picture 2 years from now…”

Actually, you do. 

See, all those backlogs you see at Caterpillar, GE Vernova, Vertiv, Powell, Comfort Systems, etc?

What do you expect gets bought when the datacenters that get these cooling, energy, and HVAC systems get installed?

The customer buys chips. 

You don’t buy the AC and the airbag without the engine. 

Investors have over-valued names with backlogs. 

Those visible backlogs in industrials represent future revenue for Nvidia which is cheaper and growing earnings faster than nearly all of them. 

Similar story for Taiwan Semiconductor. The name is up about 100% in a year and the valuation multiple is flat. 

In the last year, investors got obsessed with 2nd, 3rd order, and nth order thinking… 

Natural gas, uranium, photonics, cooling, HBM, lithography, packaging, IPPs, etc

All that is known now. 

Keep it simple. 

The dominant market leaders are still cheap cashflow machines. 

They have dramatic earnings growth and advantaged market position. 

The datacenter build out will take years…  and industrials are the read thru. 

All roads pass through Nvidia and TSM 

The pendulum is swinging back to first order. 

We need Chips.

Bill Ackman made Microsoft a ~16% position of his portfolio.

This is the third time Ackman has followed us into a name. Google last year. Meta. Now Microsoft. At this point, we should send an invoice to Mr. Ackman.

Like Google last year, this is a high-quality business at a dislocated price. The market spent six months repricing it as an OpenAI cost center. The earnings have proved otherwise.

The cheap valuation makes no sense with Azure growing 40%, Copilot seats up 250% year-over-year, and an AI revenue run rate crossing $37 billion.

The Microsoft-OpenAI divorce has actually improved the setup. They have shed the liability and kept the asset.

We are overweight. Ackman just confirmed what the fundamentals already said.

Former Bridgewater Exec turned Senator David McCormick sold Goldman Sachs ahead of the Iran conflict. 

Then he scooped it up with multiple buys in March. 

If you consider how many massive IPOs GS will lead at year-end, the idea makes sense. 

Interestingly, the Lumida App trader AI only likes the charts in financials of the two leading IPO book runners: Morgan Stanley and Goldman. 

I also can see Druck and AQR are buying recently and it triggers several of my momentum screens. 

I don’t own either but will give them a look. 

That’s one simple way to demonstrate how AI will transform investing. 

Note: Financials as an ETF have not hit ATHs yet and are a bit heavy; typical after they report earnings.

Dutta makes the case that the bond market selloff this week had almost nothing to do with CPI data — it was Middle East tensions bidding up oil, feeding into long rates, with a consumer already squeezed by three straight months of negative real wages.

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Anthropic's CFO explains why the single decision that determines whether an AI company survives is compute procurement. It is a knife-edge commitment made years in advance where buying too much bleeds you dry and buying too little means you can't serve customers either way.

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