While many investors immediately think of NVIDIA shares when they think of AI, a billionaire tech fund manager sees other companies as the most important beneficiaries of the AI boom.
• Janus Henderson relies on TSMC instead of NVIDIA for AI
• TSMC makes the chips of almost all of the AI winners
• Expert names other favorites such as Arm and Co.
The AI boom is driving the stock markets from record to record. For many investors, NVIDIA is the undisputed winner of artificial intelligence. But Jonathan Cofsky, co-portfolio manager of Janus Henderson’s Global Tech and Innovation Fund, sees another company as the main beneficiary of the AI revolution: Taiwan Semiconductor Manufacturing Company (TSMC).
TSMC instead of NVIDIA shares: The real winner of the AI boom?
As Cofsky told MarketWatch, TSMC is “probably the most important company in enabling AI right now.” The reason: The Taiwanese chip manufacturer produces the most modern semiconductors for almost all major AI chip developers – including NVIDIA, AMD and Broadcom.
According to the fund manager, the central question for investors is not which chip designer will win the race. What is much more important is how much computing power is being developed worldwide. “And it doesn’t matter which of the semiconductor vendors makes them, because they have them all manufactured at TSMC,” Cofsky said, according to MarketWatch.
TSMC is currently the largest position in the Janus Henderson fund’s portfolio and has narrowly pushed NVIDIA out of the top spot.
Arm Stock Could Benefit from the Rise of Autonomous AI Agents
In addition to TSMC, Cofsky is increasingly relying on Arm Holdings. The fund said it expanded its stake in the British chip designer at the beginning of the year.
You invest in Arm “on the assumption that agentic workflows and agents will be significantly more CPU-intensive than previous AI generations. And Arm has the most widespread architecture,” explains the expert, according to MarketWatch. In particular, so-called AI agents, which plan and execute tasks independently, require complex control and coordination processes, according to Cofsky.
According to Cofsky, the company’s change in strategy offers additional imagination. Arm is increasingly developing from a licensor to its own chip manufacturer. Meta is said to have already been won as the first customer.
Software, data and platforms: These AI stocks are also in focus
In addition to semiconductor stocks, Cofsky also relies on selected software and platform companies that, in his opinion, are particularly well protected from disruption. These include Datadog and Snowflake, which, according to the fund manager, are already benefiting from AI-driven effects and are showing a “renewed acceleration of their sales growth”. In addition, the fund invests in specialized software providers with unique data sets such as Cadence and Guidewire, whose business models are difficult to copy and, according to Cofsky, can be expanded particularly well with AI.
DoorDash is also among the stocks highlighted, although the stock has been under pressure recently. Investors’ current concerns primarily revolve around investments in the current business cycle and dependence on the economic environment. However, Cofsky emphasizes the long-term nature of the company: DoorDash is founder-led and expanding into new areas such as international food retail – with the potential to benefit from both generative and physical AI.
Not just NVIDIA and Co.: What is important for investors now
“We don’t see any signs that AI expansion will stop in the next few years. But history shows that when you spend that much money over a period of five to 10 years, there are going to be ups and downs,” the fund manager told MarketWatch.
Janus Henderson’s assessment could provide important insight for investors: If you want to benefit from the AI boom, you don’t necessarily have to rely on the best-known names like NVIDIA. Companies like TSMC potentially benefit regardless of which chip developer ultimately comes out on top, as almost all leading AI semiconductors are manufactured there. Arm, in turn, could be one of the winners of the next generation of AI if autonomous AI agents actually require significantly more computing power via CPUs. In addition, the fund specifically focuses on selected software and platform stocks that receive additional growth impetus from AI or have business models that are particularly difficult to copy.
Overall, the strategy shows that the greatest opportunities in the AI boom are increasingly distributed along the entire value chain – from chip production to data-driven software and platform models.
Bettina Schneider, editorial team at finanzen.net
This text is for informational purposes only and does not constitute an investment recommendation. finanzen.net GmbH excludes any claims for recourse.
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