Limitless: An AI Podcast

Josh:
The most famous AI bull on Wall Street just called the top on the entire AI market.

Josh:
Leopold Ashenbrennan, the 24-year-old ex-open-air researcher who got fired,

Josh:
started a fund, and turned $250 million into $14 billion in less than two years is back.

Josh:
And his latest investment portfolio is not what you'd expect.

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He's gone completely bearish the entire stock market. He has taken out an $8

Josh:
billion short across the biggest names in AI. We're talking about NVIDIA,

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AMD, Broadcom, and the entire semiconductor supply chain.

Josh:
But all is not lost. He also revealed where the next biggest AI investment is

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going to be. It's in power and memory.

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He's doubled down on his investments in data centers, as well as three brand

Josh:
new companies. We're going to get into all of this, but first,

Josh:
let's talk about the biggest changes.

Ejaaz:
EJ, the largest company in the world, NVIDIA, the poster child for the AI revolution,

Ejaaz:
the stock that has made so many investors so wealthy over this run,

Ejaaz:
is now in the crosshairs. This is the largest short position that Leopold has.

Ejaaz:
And it's not obviously apparent when you're looking at the filing,

Ejaaz:
because when you look at the portfolio of what he's most short,

Ejaaz:
we see VanEck Semiconductor ETF is number one.

Ejaaz:
And just beneath that is NVIDIA. Now, currently he has $1.5 billion of short exposure to NVIDIA.

Ejaaz:
And this comes through the form of a put.

Ejaaz:
And those who are not familiar with it, a put basically just gives Leopold the

Ejaaz:
option, but not the obligation to sell the underlying asset at a predetermined

Ejaaz:
price. So he basically buys the right to sell NVIDIA stock at a higher price should it go lower.

Ejaaz:
Now, there is a $2 billion position sitting just above this,

Ejaaz:
which is a stock that most people may not have heard before.

Ejaaz:
The ticker is SMH, and it goes by the name of VanEck Semiconductor ETF.

Ejaaz:
Within this ETF, I was looking through the holdings, and the largest holding

Ejaaz:
is actually NVIDIA at 20%, which means if you combine the top two shorts,

Ejaaz:
you get a $1.9 billion short position on NVIDIA.

Ejaaz:
And this is probably disappointing to a lot because everyone seems to believe

Ejaaz:
that NVIDIA is on a one-way trajectory north, but Leopold seems to think otherwise.

Ejaaz:
In addition to this position, we have Broadcom, Oracle, AMD,

Ejaaz:
Micron, ASML, Intel, Corning,

Ejaaz:
These are all short positions now. And what you'll know is that,

Ejaaz:
I mean, Intel, one of the ones that he made his bread and butter on,

Ejaaz:
Intel made him more money than any stock in, I think, the portfolio's history.

Ejaaz:
He is now short on Intel. And these are all new positions. He's short on Broadcom.

Ejaaz:
For those not familiar, Broadcom is the company that is responsible mostly for

Ejaaz:
building out OpenAI's project Stargate.

Ejaaz:
That means he's essentially pulling out a short position on OpenAI and Project Stargate.

Ejaaz:
So there's some concerning names here if you've been bullish on the AI market

Ejaaz:
for a while, even something like Corning, the optical glass company.

Ejaaz:
This has been a big kind of beta play after the semiconductor trade.

Ejaaz:
And he's pulled up a big short position on this. So there's a lot of shorts

Ejaaz:
that are coming on the market.

Ejaaz:
There's, like you said, $8 billion of short exposure. That's 40 times more than

Ejaaz:
the fund was worth just 18 months ago. So this is a huge position he's taking.

Josh:
Yeah, it's extremely aggressive. And it becomes more apparent when you realize

Josh:
that his entire fund thesis was based on a 64-page essay that he wrote called

Josh:
Situational Awareness.

Josh:
And the core thesis, if you remember, Josh, is a big bet on semiconductors,

Josh:
specifically that compute flops will increase on multiple orders of magnitude over the next decade.

Josh:
This explicit swing trade that he's made, this $8 billion short position,

Josh:
is effectively a bet against that now. So it either indicates one of two things.

Josh:
One, he thinks that the market is too crowded for this particular trade,

Josh:
and so he's expecting there to be short-term volatility in downwards pressure on price.

Josh:
Or he just believes something's broken in his thesis and he hasn't spoken about what that might be.

Josh:
Now, not all is lost. If you look on the right side of this chart that we're

Josh:
showing, there is a bull book as well.

Josh:
So he does hold still massive positions in stock equity positions for specific

Josh:
types of companies, as well as taking on call options as well.

Josh:
So let's look at what he's positive on.

Josh:
So CallWeave, he's maintained his position. And CallWeave has been one of his

Josh:
biggest data center or neocloud investments for the longest time,

Josh:
since the start of the fund, actually.

Josh:
And he's taken levied bets on CoreWeave in many different ways through his own

Josh:
private investment or acquisition of Core Scientific, which helps CoreWeave do its thing.

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So for those of you who aren't familiar, CoreWeave is basically a neocloud that

Josh:
creates and sets up GPUs and provides them to the biggest AI labs.

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They've signed multi-billion dollar deals with the likes of Meta,

Josh:
Anthropic, and the likes of that. And then if you look just below that, Bloom Energy.

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This was his biggest swing trade, our fan favorite of last quarter.

Josh:
Bloom Energy creates these portable gas turbines, which you can kind of like

Josh:
fly into wherever your data center is and generate energy.

Josh:
Of course, one of the biggest constraints for AI data centers right now is that

Josh:
you have all these fancy GPUs, but you can't power them up because the energy

Josh:
grid that is currently here in the US does not work. It's not really effective.

Josh:
So you need to kind of have supplemental resources.

Josh:
That is Bloom Energy. He hasn't exited this position, but he did trim off a

Josh:
cool $1 billion. dollars.

Josh:
And to be honest with you, I don't blame him. His position went from,

Josh:
I believe, $800 million to about $2.5 billion potentially over the last three months.

Josh:
So it makes sense that he's taking some money off, but he's still maintaining

Josh:
about just over a billion dollars worth of Bloom Energy stock specifically.

Josh:
And then if you look below this, he's increased a bunch of different companies.

Josh:
CleanSpark, he's increased, Riot Platforms, Applied Digital, and Iron.

Josh:
Now, if these names seem a little familiar, that's because they play in the

Josh:
same NeoCloud market as CoreWeave itself.

Josh:
So he's really doubling down on data centers and NeoCloud specifically.

Josh:
He's observed that the likes of Anthropic and OpenAI are releasing newer models

Josh:
and that compute scaling laws are just continually increasing.

Josh:
So his big bet is that GPUs is

Josh:
still needed, but right now it's a delivery function that they're facing.

Josh:
And these companies solve that versus the actual GPU manufacturer,

Josh:
which is why I guess he's short NVIDIA, Broadcom, and all the likes. So interesting to see.

Ejaaz:
Yeah, this is a new narrative trade that we have forming, where we're kind of

Ejaaz:
moving away from the semiconductors into more of that infrastructure,

Ejaaz:
into the power, into the data centers, into the memory.

Ejaaz:
And he's very much doubling down what we saw last quarter, but doing so in a

Ejaaz:
way where he's also getting short exposure to the companies that he thinks might not do so well.

Ejaaz:
Now, it's important to note that this 13F filing is a snapshot.

Ejaaz:
It is a single moment in time that is taken based on the previous quarter's

Ejaaz:
trades. So the trades that are in this 13F filing, the holdings in there,

Ejaaz:
are from January 1st to March 31st. This is basically where he ended the quarter.

Ejaaz:
And Leopold has been right pretty much every single time.

Ejaaz:
And we've seen his portfolio grow from $220 million to that,

Ejaaz:
what, $13.7 billion in notional value currently.

Ejaaz:
But there are some things that he might be getting wrong. When I go back to

Ejaaz:
that shortlist and I think about the companies that he shorted,

Ejaaz:
AMD is one of those large shorts.

Ejaaz:
AMD is up 74% in the last month. And he shorted it.

Ejaaz:
So he picked perhaps one of the most expensive moments to bet against this rotation,

Ejaaz:
but nonetheless, he thinks that the rotation is happening.

Ejaaz:
So is it a timing thing? Is it a general thesis thing?

Ejaaz:
Another one that was surprising is ASML.

Ejaaz:
I mean, as far as I'm concerned, ASML is still the only company that can do lithography.

Ejaaz:
It's a 100% monopoly on these chips, and he's shorting that.

Ejaaz:
So clearly, the thesis really is strongly presented towards memory and power

Ejaaz:
and infrastructure over the semiconductors. And I think it's just noteworthy to mention.

Ejaaz:
Now, we have these two charts, the book by the numbers that shows the stock

Ejaaz:
only positions as well as the top options positions.

Ejaaz:
Maybe we want to walk through that briefly just to do a little trace over of

Ejaaz:
what he currently holds and where.

Josh:
Well, I think what actually might be more useful, Josh, is if we walk through

Josh:
like what his thesis might be for all of these positions, right?

Josh:
Because these are pretty aggressive, right?

Josh:
You've got like, why is he doing this? We've got like a massive short position, $9 billion.

Josh:
That is not a small like number. And then we have this like small,

Josh:
weirdly bullish position. but we're unsure because like they're just a bunch

Josh:
of near clouds and power companies which we haven't really heard of like are

Josh:
these good are these bad so here's my take.

Josh:
He's doing a bi-directional trade here for his thesis, and that is he is short silicon.

Josh:
So he thinks it's an overcrowded trade. He thinks GPU designers such as NVIDIA,

Josh:
Broadcom, as well as maybe manufacturers of the chips themselves,

Josh:
TSMC, they're all like overcrowded trades right here. I don't think he thinks

Josh:
he's bearish those things.

Josh:
I just think that he thinks that they're overvalued right now.

Josh:
And then conversely, he's very long power. He understands data centers and GPUs,

Josh:
unlike nobody else in this entire market.

Josh:
He has researched these things for goodness knows how long. And so he,

Josh:
of all people, will know where that next constraint is.

Josh:
And obviously, he thinks it's power, energy.

Josh:
He doesn't think there's enough energy or ways to get this power and energy to the GPUs itself.

Josh:
So maybe it's not that he's explicitly bearish on the semis specifically,

Josh:
but he thinks that his money is better spent chasing that next constraint.

Josh:
And he's expressed that as not just power, by the way, it's memory as well.

Josh:
He doubled down on SanDisk as well, which, by the way, is up like 40,000% over the last year.

Josh:
So you would think that if any trade was overcrowded, it would be SanDisk.

Josh:
But obviously, he sees something that we haven't.

Josh:
SanDisk is famous for creating a specific type of memory known as NAND flash.

Josh:
Which allows you to kind of store temporary memory for AI models.

Josh:
Like when you talk to an AI model, it needs to store temporary memory about

Josh:
you so that he can remember stuff and recall stuff when you're conversing with it.

Josh:
That is explicitly something that SanDisk provides.

Josh:
So I think that he isn't necessarily bearish, the GPUs.

Josh:
He's just short-term thinking that it's an overcrowded trade and his money's

Josh:
better spent on things like power and memory.

Ejaaz:
And now I'm wondering, is he bullish or bearish on the market as a whole?

Ejaaz:
Because I mean, this is the first time in the fund's history where the short

Ejaaz:
side of the book is actually larger than the long side in terms of notional

Ejaaz:
value and exposure that they have.

Ejaaz:
And this is a really stark difference for someone who's been really up only and long only.

Ejaaz:
And when I was first evaluating this, I was wondering, well,

Ejaaz:
is this just a hedge? Is this protecting his investments because they've gone up so much?

Ejaaz:
Maybe he's just locking it in and he's kind of protecting his downside.

Ejaaz:
But if it was a hedge, you'd really

Ejaaz:
only expect kind of smaller positions sized to offset the long book.

Ejaaz:
And we saw this last quarter where he had some hedge positions,

Ejaaz:
but it was mostly a hedge.

Ejaaz:
It wasn't a directional bet. But now that the puts are larger than the longs,

Ejaaz:
it's kind of a directional bet on the market going down.

Ejaaz:
So it seems like this weird pseudo thing where he expects the AA market to perhaps go down.

Ejaaz:
Even as a result of that, some of these things, the memory, the infrastructure,

Ejaaz:
the energy will continue to go up. And that's the bet.

Ejaaz:
So I wonder how that impacts the broader market as a whole, because it puts

Ejaaz:
him in this like weird juxtaposed position where the market goes down,

Ejaaz:
but yet some positions will not be going down. Does that make sense?

Josh:
We actually have some proving points around that, because I think you're touching

Josh:
on something which is basically uncertainty.

Josh:
He doesn't know whether in some cases he's right or whether the market will

Josh:
go up and down. and you see that with he's matched a bunch of his put positions

Josh:
with call positions as well aka.

Ejaaz:
This is a great chart yeah

Josh:
He's trading a bi-directional book so what that

Josh:
means is uh in typical kind of like hedge fund manner mannerisms if you don't

Josh:
know where the market is going to go whether it's going to go up or down you

Josh:
hedge positions and you can cream off profit from the premiums that you make

Josh:
between these positions so let's say you take out i'm just making this up like

Josh:
a $10 million put position on one company,

Josh:
you can take out the equivalent on the other side and then like just earn from

Josh:
the margins between those different positions.

Josh:
If the price goes up or the price goes down, you still get paid premiums,

Josh:
right? It's known as like a collar trade specifically.

Josh:
So he's done that on four companies, the biggest one being Micron.

Josh:
And if he's bullish Sandisk memory, I don't understand how you would also be

Josh:
bearish from a thesis level on Micron, which is like the biggest US play.

Josh:
You know, Leopold is a purist, I believe.

Josh:
And so he's very bullish American stocks. That's why he made his biggest amount

Josh:
of money from the Intel trade. He's doing it with Boom Energy, NVIDIA and the like.

Josh:
So it would seem weird that he's like taking out a short position on Micron.

Josh:
But the way I understand it is he's doing this as a flat trade.

Josh:
He doesn't know which way it's going to go.

Josh:
He does believe the market is overcrowded. He does believe long term it's going

Josh:
to do very well. But he can't play around with, you know, a crazy billion dollar swing trade.

Josh:
So he's decided to hedge the market. And I think that's pretty smart, actually.

Ejaaz:
Yeah. And I guess you could kind of reduce this down into four key claims to this new thesis.

Ejaaz:
This is the new Leopold thesis. The first one being that the bottleneck has

Ejaaz:
moved from chips to electrons. And we have that.

Ejaaz:
We kind of know that a lot of chips are available.

Ejaaz:
The problem is figuring out where to plug them into.

Ejaaz:
And we see that with the most recent deal that was announced between SpaceX

Ejaaz:
and Anthropic, where Anthropic is so desperate for compute, they're willing

Ejaaz:
to partner up with their rivals in order to get it. That is not a matter of

Ejaaz:
not having enough chips.

Ejaaz:
It's a matter of not having the correct infrastructure to deploy these chips at scale.

Ejaaz:
The second claim is that chip valuations are priced for a world that doesn't really exist anymore.

Ejaaz:
That ETF, the SMH ETF that we mentioned earlier, it's up 66% year to date.

Ejaaz:
Meanwhile, Intel is up 200%. So while the market is pricing in a world where

Ejaaz:
every name and semis benefits equally from this AI demand, Leopold is taking

Ejaaz:
account of that. He's saying, that's not how this works.

Ejaaz:
There are winners and there are losers. And the early winners are the ones that

Ejaaz:
are going to keep on winning. And he's going to continue to pursue that as far as he could take it.

Josh:
I just noticed something crazy as well, Josh.

Josh:
If we go back to these long positions that he's taken.

Josh:
So he's maintained his core position and he's doubled down on a bunch of neoclouts, right?

Josh:
These neoclouts, these companies stand to benefit from the exact thesis that

Josh:
he's trading with this new portfolio.

Josh:
So let's say that semi stocks go down, right?

Josh:
Their stocks would also go down, right? Because they own the GPUs.

Josh:
But CoreWeave and these other companies own something else that NVIDIA currently

Josh:
doesn't have, which is...

Josh:
The power access. Remember, he invested in a bunch of these NeoClouds,

Josh:
not just because they can run GPUs.

Josh:
That's something that any data set it could do. You just need capital to do it.

Josh:
But more importantly, they have the licenses and access to existing energy grid

Josh:
infrastructure that can serve these GPUs.

Josh:
So he's playing both sides of the trade pretty intelligently through just a

Josh:
single company that can express both his interest in the power trade,

Josh:
but also his bearishness on the semis trade as well.

Josh:
Like he can have a win-win. And that makes sense because that's the companies

Josh:
that or type of companies that he's doubled down on.

Josh:
It's exactly these data center neocards that have access to power.

Josh:
It's a pretty smart trade.

Ejaaz:
And he's also doubled down on this fun little Easter egg on where you can actually

Ejaaz:
get this power and get this grid capability.

Ejaaz:
And those are Bitcoin mining companies. We talked about this briefly last quarter,

Ejaaz:
but he's going big on them again.

Ejaaz:
And this year, US Bitcoin miners are going to approximately put 30 gigawatts

Ejaaz:
of interconnected power capacity online.

Ejaaz:
That's roughly, I mean, for comparison, that's roughly the total amount of Microsoft,

Ejaaz:
Google, Amazon, and Meta combined in what they announced.

Ejaaz:
So this is a tremendous amount of data centers that they're putting online that

Ejaaz:
everyone's going to need.

Ejaaz:
And because people are kind of pivoting from Bitcoin to AI, they already have

Ejaaz:
a lot of the critical infrastructure. They have the power.

Ejaaz:
They have the data center's size. They have it built out.

Ejaaz:
All they need to do is swap in new chips that are built for AI,

Ejaaz:
and they're on their way. And that is a really unique, interesting case that

Ejaaz:
I don't think I've seen a lot of people explore other than Leopold.

Ejaaz:
It's just taking the Bitcoin pivot, the crypto pivot. A lot of Bitcoin miners,

Ejaaz:
they're there to follow the money.

Ejaaz:
And when the money's in AI and they could put 30 gigawatts online in a single

Ejaaz:
year, that's a huge amount.

Josh:
Yeah, when I zoom out from this, right, everything we've discussed so far,

Josh:
there's like a clear view that he's taking here, which is he's doubling down

Josh:
on physical infrastructure.

Josh:
He doesn't believe that can get commoditized.

Josh:
What he's saying, and this is a big statement, is he thinks the design layer

Josh:
of semiconductors, the chip side of things, is overcrowded.

Josh:
Now, may I remind everyone, NVIDIA doesn't actually make the chips.

Josh:
They're a design company. They create the design and they send the blueprints

Josh:
to this company in Taiwan called TSMC, and they actually manufacture and build

Josh:
the chips for them, right?

Josh:
Broadcom does the same thing. Intel creates CPUs and GPUs. AMD as well.

Josh:
These are two companies that he's short on this recent filing.

Josh:
But again they create the designs for these things

Josh:
they don't actually build the thing now intel and amd's intention is

Josh:
to eventually do this but they haven't got the necessary factories or infrastructure

Josh:
to be able to do this that's their plan in the next like five years so he's

Josh:
making an explicit bet which is like the design space for chips is overcrowded

Josh:
but the hardware infrastructure layer is where all the money is going and one

Josh:
thing that they need as a substrate more than anything is power and so he's making that bet.

Ejaaz:
Yeah. Okay. So we have this one section that talks about where the trade breaks,

Ejaaz:
where this thing can start to break down.

Ejaaz:
Now I mentioned earlier, AMD, he was short on, it's up 75%. That's got a sting.

Ejaaz:
Is this correct? And we have a few things listed here on where it breaks.

Ejaaz:
The first being around Nvidia, the largest short position through these two

Ejaaz:
holdings that he has of $1.9 billion.

Ejaaz:
And it could break in the sense that Nvidia's moat is actually stickier than he thinks.

Ejaaz:
So currently he's betting on the fact that Nvidia is going

Ejaaz:
to become kind of commoditized as it relates to chips likely that

Ejaaz:
other companies like google and amazon through their tpus or

Ejaaz:
their trinium chips are going to slowly start to chip away at

Ejaaz:
the nvidia monopoly and the reality is

Ejaaz:
that that may not be entirely true when you

Ejaaz:
see a lot of the purchase orders coming in when you look at the the margins that

Ejaaz:
they have around 80 on these gpus a lot

Ejaaz:
of the volume is still coming into nvidia and

Ejaaz:
a lot of that is due to this thing called kudo which is the platform lock-in

Ejaaz:
it's the software stack that runs on top of this hardware and

Ejaaz:
it's very custom it's very kind of niche and

Ejaaz:
the people that can build for it and there's a world in which that becomes a

Ejaaz:
pretty strong molt a moat in which people who are investing

Ejaaz:
in nvidia they don't want to leave people who are building

Ejaaz:
up these data centers it's just easy because they built it before and building

Ejaaz:
custom infra for all these new chips is going to be complicated is that

Ejaaz:
true or not we don't know anthropic is kind

Ejaaz:
of taking the route of it not being true they've partnered

Ejaaz:
with amazon for um for tranium chips they

Ejaaz:
partnered with google for tpus and they're using nvidia but

Ejaaz:
then you see a company like xai and colossus their entire data

Ejaaz:
center is purely nvidia gpus and just workhorses and they're taking the new

Ejaaz:
blackwell chips and they're building them up as fast as they can and they're

Ejaaz:
very much leaning into that coup de moat so it's something that we're gonna

Ejaaz:
have to see this is one of the thesis that that might play out but it could

Ejaaz:
be a little difficult and i mean again nvidia is the most valuable company in

Ejaaz:
the world this is a big company to start to fall apart now

Josh:
Yeah, I mean, we have NVIDIA GPUs that are six to eight years old that are being

Josh:
rented out a year in advance of their contract expiring, right? And people are paying.

Ejaaz:
For more value than they were years ago. So the old H100s from years ago are

Ejaaz:
actually worth more today than they were two years ago. That's unbelievable.

Josh:
I mean, Leopold's trading stock kind of reminds me of another trader that we

Josh:
spoke about a few months ago that got burned pretty badly, Michael Burry,

Josh:
who went incredibly perish on NVIDIA right at the point that the stock absolutely set.

Josh:
So I hope the same thing doesn't happen to Leopold.

Josh:
But to kind of like also pick apart at some of the other kind of like gaps in

Josh:
his potential thinking or risks here is Leopold runs a hedge fund, right?

Josh:
Situational awareness fund isn't a VC fund, which is typically like long only.

Josh:
It's actually kind of rare to see a hedge fund go super long as aggressively as he did, right?

Josh:
So the point being is what you see or what we're speaking about in the 13F filings,

Josh:
which is something that he has to submit, his trade breakdown,

Josh:
his investment portfolio, every three months, may not be the latest and greatest

Josh:
trades that he's currently made.

Josh:
In fact, today, as we're speaking about this, after he's filed the report at

Josh:
the end of March, he could have changed all these trades.

Josh:
He could have done completely something different, right? Another thing I think about is...

Josh:
When did he take these put positions? When did he take these specific positions?

Josh:
They could have been at the start of the year.

Josh:
And like, you know, the fund could have suffered pretty badly.

Josh:
Now, the obvious evidence to prove that this isn't the case is the fact that

Josh:
the value of his fund went from $5.5 billion three months ago to $14 billion.

Josh:
So the point is, he's made money. He's taken off money from the top.

Josh:
And it's important to point out that these put positions, these call positions,

Josh:
these are kind of like levered bets.

Josh:
So when we talk about an $8 billion put position in total,

Josh:
he's typically probably only put up like a billion dollars

Josh:
worth of actual capital right now he's also paying

Josh:
a lot of fees and premiums on that so it's like a short-term trade

Josh:
again i must say like he might have existed some of these trades already so

Josh:
if you're reading this if you listen to this and you're thinking oh my god i

Josh:
need to change my entire stock uh portfolio remember you may not necessarily

Josh:
be trading like him you're not doing short-term or high frequency trades you

Josh:
might be in it for the long term and that's a very different type of kind of

Josh:
like approach and maybe josh this

Josh:
is a good time to talk about what the retail audience can do about this and

Josh:
like what the actual thesis might be and where you might want to invest your money going forward.

Ejaaz:
Yeah. So we actually have some data to back this up through Polymarket,

Ejaaz:
which shows us that things might not be as bad as we're perceiving them because

Ejaaz:
again, retail is different than what he's doing.

Ejaaz:
I mean, Leopold is a trader. If you're a retail investor, things are a little bit different.

Ejaaz:
If you think that the AI bubble is going to pop and that's what this implies,

Ejaaz:
is according to Polymarket, that's sadly mistaken.

Ejaaz:
There's only a 24% chance of the AI bubble bursting by December 31st of this year.

Ejaaz:
Very low probability. There's also a second market that I wanted to highlight,

Ejaaz:
which shows the largest company by the end of May this month in a few more weeks.

Ejaaz:
Now, currently, NVIDIA is the largest company in the world, and they're pretty

Ejaaz:
closely followed by Google.

Ejaaz:
The reality is, though, according to Polymarket, there's still a 93% chance

Ejaaz:
that it stays this way, that NVIDIA is going to continue to take the crown throughout

Ejaaz:
the course of this month, And I think that's a testament to...

Ejaaz:
A little bit less volatility than he may be implying with these earnings and with this 13F filing.

Ejaaz:
So again, it's important to note that this is last quarter's news.

Ejaaz:
The tides have turned pretty considerably.

Ejaaz:
We don't know what's happened over the last couple of months that he's been

Ejaaz:
trading, but I think it's a good testament to the fact that things aren't quite

Ejaaz:
as bad as it may seem on the surface.

Ejaaz:
He's just applying a new strategy that kind of alters the trajectory of this portfolio.

Ejaaz:
And thank you to Polymarket for showcasing these charts. So yeah,

Ejaaz:
I guess we should get back to the question of how do you as a retail investor

Ejaaz:
adjust to this what is your strategy how do you navigate this are you bullish

Ejaaz:
are you bearish you just do you have any ideas on like kind of your your gut

Ejaaz:
take on how you personally plan to position yourself or how people should consider

Ejaaz:
positioning themselves around this new information so

Josh:
I'll give you two answers if i was someone who is kind of like new into this

Josh:
market um and is just reading leopold's 13f filing and are basing their trading

Josh:
decisions off of that, you would be tentative.

Josh:
This isn't a time to go crazy and go all in on a single stock.

Josh:
I would never advise that anyway.

Josh:
But the point is, I think he's being conservative for a reason,

Josh:
which is the market on average has probably run up a couple hundred percent over the last two years.

Josh:
And that in a regular stock market is absolutely huge. If you look at the major

Josh:
increases in the S&P 500, it has primarily been through five top companies in

Josh:
the Mac 7, which have all invested extremely heavily and aggressively in AI.

Josh:
And that money flows downstream into a lot of these companies that we've spoken about already.

Josh:
So he may just be suggesting that it is an overcrowded trade,

Josh:
so just be cautious and careful. That being said,

Josh:
I always have a bullish cap on, Josh. And where my mind goes to right now is

Josh:
in the power and energy side of things.

Josh:
Now, I'm aligned with Leopold on the Bloom Energies and the data centers side of things.

Josh:
In fact, I think it's genius that even if you invest in some of these top neocloud

Josh:
providers who are signing, by the way, multi-billion dollar deals with Anthropic

Josh:
and Meta, you still get to benefit if the semiconductor space goes down because

Josh:
they own the power capacity.

Josh:
That's something new that I've learned from this that I'm feeling extremely bullish on, right?

Josh:
So that's something that I might pop my money in, right? equally so,

Josh:
I'm looking at some of his short positions on the likes of companies such as

Josh:
Corning, which is also a bottleneck, right? It's on the optic side of things.

Josh:
And NVIDIA just signed a massive multi-billion dollar partnership with them,

Josh:
and he's short on them. So he's kind of picking and choosing which bottleneck that he wants.

Josh:
I'm kind of more bullish on power at this point, but I don't know if he's completely

Josh:
nailed it when it comes to some of these optical fiber networks and some of

Josh:
the other short positions that he has. I don't know. What about you?

Ejaaz:
Yeah, I think that, well, the general trend through all of this is,

Ejaaz:
for me at least personally, the way I think about navigating AI is that the

Ejaaz:
two most powerful, two most important things

Ejaaz:
our energy and the physical movement of these atoms, I think the physical world

Ejaaz:
is really difficult and complicated and moves much slower than the world of software.

Ejaaz:
And if anyone has a unique advantage around manufacturing, around actual construction,

Ejaaz:
around gaining the permits to put these things online, that is a huge structural advantage.

Ejaaz:
The second one is the energy. Everyone is desperate for energy.

Ejaaz:
Nobody wants to be the bad guy in kind of absorbing the data centers,

Ejaaz:
using data centers to absorb energy from normal people where they go into cities

Ejaaz:
and they kind of pull off the grid and energy prices go higher.

Ejaaz:
Everyone wants these two things. They want to be able to physically manufacture

Ejaaz:
things in a way that is cheap, easy, fast, efficient.

Ejaaz:
They want to be able to have abundance of energy. If there's a company that

Ejaaz:
has anything that slightly resembles a monopoly in either of these two categories, it's a huge win.

Ejaaz:
And it's probably something to invest in because they're durable.

Ejaaz:
On the chip stack, there's a lot of competition.

Ejaaz:
There are a lot of people competing directly with NVIDIA. We see it with Amazon and their chips.

Ejaaz:
We see it with Google and their TPUs. And there's a lot of other companies like

Ejaaz:
Cerebris, we mentioned last week, had their IPO and they have this brand new novel architecture.

Ejaaz:
There's a lot of competition there that might flatten margins a little bit.

Ejaaz:
Granted, they're still incredibly high, but there is a chance.

Ejaaz:
Now, in terms of what to look for moving forward, because these are a few things

Ejaaz:
that I'm going to be interested in, kind of fact-checking Leopold,

Ejaaz:
seeing if he's actually doing as well as he performs.

Ejaaz:
NVIDIA has their earnings coming up pretty soon, May 28th.

Ejaaz:
And if they guide above $78 billion dollars for the next quarter there's a pretty

Ejaaz:
good chance those puts get get crushed um they might not be doing too well so

Ejaaz:
we have these earnings reports that are coming towards the end of this month

Ejaaz:
we have amd has an analyst day in 2026 we have some pretty serious bloom energy

Ejaaz:
deployment milestones that we're going to look into

Ejaaz:
Those are going to be kind of checkpoints that we could then cross-check against

Ejaaz:
Leopold's portfolio to see if it is accurate.

Ejaaz:
But I think thematically, the

Ejaaz:
idea of energy and infrastructure are two that are not going to go away.

Ejaaz:
And when I'm investing and when I'm considering allocating my portfolio,

Ejaaz:
those are the two categories that I'm probably most interested in.

Josh:
Well, I probably then want to do a little bit of a victory lap for us because

Josh:
about a week and a half ago, maybe two weeks, you know, I don't want to brag too much.

Josh:
We did an episode that broke down where some of the top AI investment trades

Josh:
might potentially be in the future.

Josh:
And we went down this infrastructure stack, right?

Josh:
And we walked all the way from model labs flowing down to hyperscalers and AI

Josh:
platforms, such as the Mac 7 that I mentioned earlier, as well as these GPU semiconductors.

Josh:
And the point that we made on this episode was that the money is going to flow

Josh:
from these GPUs and semiconductor trades, so like the likes of NVIDIA,

Josh:
AMD, Broadcom, these are all companies, which by the way, he took out the massive shorts on,

Josh:
all the way down into the memory and storage layer and the power and infrastructure layer.

Josh:
And these are the companies where, you know, overall, he's going pretty bullish

Josh:
on, right? He's expressing it through NeoCloud's data centers.

Josh:
He's expressing it through SanDisk and specific kind of like memory verticals

Josh:
and power infrastructure companies.

Josh:
But the point is, we potentially may have called this earlier on,

Josh:
and we're just following along at Limitless where these different constraints

Josh:
and bottlenecks are, because it's very important to understand that AI isn't a one-to-one trade.

Josh:
You can certainly buy and hold a company such as media and maybe you're better

Josh:
off over the next decade I think directionally that's probably going to be true

Josh:
but you'd be remiss if you assume that it was just park your money in one sector and

Josh:
you're good the point is the money is flowing through this into AI is like kind

Josh:
of like a car you kind of like it ingests gasoline and like it uses it across

Josh:
all its entire infrastructure and then comes out the other end as exhaust fumes

Josh:
we are currently I don't know,

Josh:
two-thirds of the way through this car, Josh? I don't know.

Ejaaz:
We're making our way down the stack.

Josh:
We're making our way down the stack. And I just want to point out that,

Josh:
like, this isn't just, like, a thesis that we have, like, pulled out of thin air.

Josh:
It's based on actual factual numbers.

Josh:
Like, for example, memory prices are absolutely sky high right now.

Josh:
It's gone up on an average of 3% to 500% across all the top memory manufacturers

Josh:
over the last nine months.

Josh:
And if you look at any of their capacity, they're booked out for the next year,

Josh:
actually, until the end of 2027. So it's like a year and a half at this point.

Josh:
So these are very real numbers. Now, whether more supply will come out,

Josh:
whether more power generation kind of pops out of thin air, we don't know.

Josh:
But directionally, the bet that he's making is in line with our thesis that

Josh:
we have on the list. So that's pretty cool to see.

Ejaaz:
And if you've been tuned in, yeah, you're up to date. You know all these things

Ejaaz:
already. You're familiar with the AI stack. If you haven't seen this episode,

Ejaaz:
we released it last week. It performed really well.

Ejaaz:
So I would highly recommend going to check it out. We're going to continue covering

Ejaaz:
this, monitoring the situation. We had the Cerebrus IPO.

Ejaaz:
We now have Leopold's new filings. There's a lot of new coverage to talk about.

Ejaaz:
We have some funny memes as well. This one from Nick Carter that is using Leopold

Ejaaz:
as a joke that says, I don't want to play with you anymore.

Ejaaz:
He's kind of throwing away the AI industry because he's sick of them.

Ejaaz:
And this is a good one. The last thing Intel investors see before they panic

Ejaaz:
sell. Poor guy, man. Intel bulls. Intel bulls. He turned on you.

Josh:
I'm an Intel bull. He turned on me.

Ejaaz:
He made billions of dollars and then he slammed the cell phone and he said,

Ejaaz:
I'm done. I don't want you anymore. more.

Ejaaz:
So we'll see. We'll be following it. I mean, over the next couple of weeks in

Ejaaz:
particular, as we see these earnings reports roll out, as we start to see the

Ejaaz:
market reaction to this filing and the new narratives wind shift over to memory,

Ejaaz:
over to infrastructure and energy.

Ejaaz:
We'll just continue to monitor the situation. So thank you so much for joining.

Ejaaz:
I think that's a wrap on the 13F.

Ejaaz:
We kind of now are fully up to date. We know the new positions.

Ejaaz:
We know what he pulls on. We know what he's bearish on.

Ejaaz:
He just, what's the prompt for everyone? How should they kind of think about

Ejaaz:
navigating this as they leave this episode and go sit there and stare at their

Ejaaz:
portfolio and ponder what changes to be made? Do I need to react based on Leopold?

Josh:
So here's how I feel at the end of this episode, Josh.

Josh:
And here's what I'm going to prompt people to do. How I feel is I'm the biggest

Josh:
fan of Leopold. Don't get me wrong. I think he might have some stuff wrong here.

Josh:
So what I want people to point out in the comments is what part of Leopold's

Josh:
thesis do you disagree with?

Josh:
And let us know why you disagree with it. Because I think, like,

Josh:
I'm not going to speak on behalf of Josh, but I feel like a little unsettled,

Josh:
and I'm unsure whether Leopold knows what he's doing.

Josh:
In fact, I think given his trading breakdown, I think he doesn't know what he's

Josh:
doing either. He's playing it safe.

Josh:
So tell us what we're missing, and maybe Limitless will guess it or preempt

Josh:
it before it actually happens.

Ejaaz:
If you had to pick one thing that he's missing or he gets wrong,

Ejaaz:
do you have any top choice?

Josh:
NVIDIA. Why are you?

Ejaaz:
I was going to say the same thing.

Josh:
If NVIDIA goes down, all your stocks go down, dude. Like that's the way I see it. So yeah, NVIDIA.

Ejaaz:
Yeah, 1.9 billion short on NVIDIA seems a little suspect. I'm a little confused

Ejaaz:
what's going on there, especially because those margins are high.

Ejaaz:
Everyone needs Blackwell. We're just starting to get the early versions of those

Ejaaz:
Blackwell models. And if you'll remember, the first one that came out of it was Mythos.

Josh:
Yes.

Ejaaz:
Clearly, there's like a tremendous amount

Ejaaz:
of value stored up in the NVIDIA infrastructure stack in the software.

Ejaaz:
It is up only. It is the most valuable company in the world.

Ejaaz:
And to not continue to bet on the winners seems like a losing strategy.

Ejaaz:
But as always, we'll see.

Ejaaz:
We'll check in. We will stay up to date and we will keep all of you updated

Ejaaz:
in the loop every day as we follow this journey along the frontier of AI investing

Ejaaz:
and all of the crazy technologies.

Ejaaz:
So thank you all so much for watching. If you enjoyed this episode,

Ejaaz:
don't forget to share with a friend.

Ejaaz:
Don't forget to leave a comment on YouTube. perhaps give us a thumbs up and

Ejaaz:
a five star review on your favorite podcast player

Ejaaz:
With that, we're done. That's a wrap. You're now up to speed on Leopold.

Ejaaz:
Yeah. Do with this information what you will.

Josh:
Not financial investment advice at all. Yeah. All right. See you guys.

Josh:
All right. We'll see you guys in the next one. Peace.