We have two charts this week which represent two massive themes in the world today. Artificial Intelligence (AI) and Lithium. Elon Musk has been in the news talking about how to control AI and the regulation that needs to be introduced to control it. The same man runs an electric car Company Tesla which is paving the way for mass market electric cars, which require lithium battery technology. China is ramping up its battery building capacity going head to head with Elon’s Tesla Gigafactory. The below article from Bloomberg highlights a Wall Street disturber in fine form. His name is Hedge Desmond Lun, the hedge fund manager with a claim to fortune of a 21 percent average return over the last four years. He is considered by some as late to the “quant party” referring to his late entrance into automated trading by computers. Admittedly Lun doesn’t understand one hundred percent how it works given the large number of variables it used to calculated investments. The quant system is as far opposite from a Warren Buffett buy and hold investor as one can get. The computer holds the investments for an average of 6 days! It focuses on index movements to make profits, stripping back billions of interactions including prices, securities, commodities and indexes before investing. At June 30 the fund was long the FTSE 100 index and short MSCI Emerging Market Index! The fund has $20 million under management with plans to grow to $200 million. An almighty challenger for Desmond Lun who grew up in Melbourne. His fund Taaffeite Capital stemmed from the rare gemstone taaffeite found in Australia.
We also stumbled upon this jaw dropping picture of why China is such a powerful force in the world. Electric car demand is increasing by the day as people look to go green, preferring to charge their cars at home and avoid petrol stations.
Look how it compares to Tesla? Elon Musk, look out.