Top 4 Stocks I'm Buying After DeepSeek (Even Over Nvidia Stock)

Summary

This video explores DeepSeek's groundbreaking AI advancements, which drastically reduce training costs and improve model efficiency, challenging the status quo in AI development. It presents two investment paths: software-focused companies like CrowdStrike and Palantir that benefit from AI’s cost-effectiveness, and hardware-centered companies like Meta Platforms and Taiwan Semiconductor that could profit from growing demand for AI chips. The script highlights how DeepSeek's innovations will reshape both AI hardware and software landscapes, offering a compelling case for diversifying investments in the evolving AI market.

Takeaways

• 😀 Deep Seek R1 is a significant breakthrough in AI, possibly changing the AI landscape just like ChatGPT did for Nvidia's rise.
• 😀 Deep Seek's AI model was reportedly trained for $5.5 million, much cheaper than OpenAI’s $200 million for GPT-4, demonstrating huge cost efficiency.
• 😀 Deep Seek’s use of cheaper H800 GPUs instead of Nvidia’s high-end chips is a key innovation, showing that AI can be trained on less expensive hardware.
• 😀 Deep Seek's breakthroughs focus on memory efficiency, with techniques that improve AI model training by using 8-bit numbers, compressed data, and sharing parameters between models.
• 😀 One of Deep Seek's key advances is reasoning capabilities, where the AI model taught itself to think and improve its outputs without direct programming.
• 😀 AI costs are becoming cheaper, potentially leading to more widespread adoption and increased demand for cybersecurity solutions, benefitting companies like Crowdstrike.
• 😀 Crowdstrike’s Falcon platform excels in cybersecurity, securing devices and networks from threats, and its stock is benefiting from increasing demand due to the rise of AI tools.
• 😀 Palantir, with its AI-driven platforms like Gotham and Foundry, is positioned to thrive if AI spending shifts towards software rather than hardware.
• 😀 Meta Platforms is investing heavily in AI infrastructure, seeing it as a long-term strategic advantage. They plan to integrate Deep Seek’s innovations into their open-source models.
• 😀 Taiwan Semiconductor (TSMC) stands to benefit greatly from the increase in AI chip demand, as they manufacture 90% of advanced chips used in AI models.
• 😀 Despite cheaper AI training costs, demand for AI hardware could rise due to increased usage and broader applications, benefiting both hardware and software companies alike.

Q & A

What is the significance of Deep Seek R1 in the context of AI advancements?

Deep Seek R1 is considered a groundbreaking moment in AI development because it demonstrated that AI models could be trained at a fraction of the cost compared to previous models, making AI more accessible and efficient.

How much cheaper was it to train Deep Seek R1 compared to OpenAI's GPT-4?

Deep Seek R1 was trained for around $5.5 million, which is 35 times less than the $200 million spent to train OpenAI's GPT-4.

What key innovation did Deep Seek bring to AI model training?

Deep Seek introduced techniques that significantly improved memory efficiency, such as using 8-bit numbers instead of 32-bit, predicting multiple words at once, and sharing parameters across multiple models, resulting in about a 45x improvement in training efficiency.

What is Chain of Thought reasoning and why is it important for AI models?

Chain of Thought reasoning allows AI models to break down problems into multiple steps, helping them check their answers and correct errors, which is crucial for improving the reliability and accuracy of AI responses.

What two distinct paths are discussed regarding the future of AI investment?

The two paths discussed are: one where companies spend less on AI chips and infrastructure, relying more on software (e.g., CrowdStrike, Palantir), and another where demand for AI hardware increases due to the rise in AI model usage (e.g., Meta Platforms, Taiwan Semiconductor).

What was the impact of Deep Seek's breakthroughs on the cybersecurity market?

Deep Seek's breakthroughs made AI tools more powerful and cheaper, increasing the potential for cyberattacks. This has benefited cybersecurity companies like CrowdStrike, which saw their stock reach an all-time high after Deep Seek was hit by a cyberattack.

Why is Palantir considered a strong investment if Deep Seek shifts AI spending from hardware to software?

Palantir is positioned as a strong investment because its AI platforms, such as Gotham and Foundry, use AI to create digital twins of organizations, optimizing data science and operations. Its platforms are essential for large enterprises and governments, and Palantir benefits from the increasing use of AI for data analysis.

What does Mark Zuckerberg believe about AI infrastructure and Meta's future role in AI?

Mark Zuckerberg believes that heavy investment in AI infrastructure is a long-term strategic advantage for Meta, which plans to implement Deep Seek's advancements into its open-source Llama models. He expects Meta's AI assistant to reach one billion users.

How is Taiwan Semiconductor poised to benefit from the AI revolution?

Taiwan Semiconductor is poised to benefit from the AI revolution because it manufactures most of the world's advanced microchips, including AI chips for companies like Nvidia. As demand for AI hardware increases, TSMC, which specializes in chip fabrication, stands to profit significantly.

What is the significance of TSMC's role in chip fabrication?

TSMC benefits from economies of scale and network effects due to its focus on chip fabrication, which allows it to build custom processes and apply learned best practices across various chip designs. This positions TSMC as a dominant player in the AI hardware market.