The aggressive pivot toward technology stocks by some of China’s most prominent fund managers is reversing, with the unwinding of artificial intelligence positions weighing heavily on fund performance.
The shift marks a notable departure from the earlier surge in AI equities that had generated substantial returns for these investors earlier in the year.
The retreat is driven by growing skepticism regarding the investment returns on cloud-service infrastructure.
As doubts mount about the profitability of the underlying assets, the sector is facing renewed selling pressure.
This development aligns with warnings issued by two Chinese hedge funds, which have described the current AI investment boom as a 'superbubble' on the verge of collapsing.
The sentiment shift among seasoned managers suggests a broader cooling in the market's appetite for high-multiple tech plays.