Unlocking EQ: Zheng Fang Sees AI as the Next Investment Frontier with NVIDIA Leading the Charge

In a recent interview, Zheng Fang, Chief Investment Officer at Caseberg Investments, offered insights into the evolving global investment landscape, particularly the promising opportunities within the realm of artificial intelligence (AI). As the world grapples with macroeconomic shifts, Zheng underscored the importance of aligning investments with major trends, citing AI as a significant growth area.

Zheng described human development through three transformative stages: the agricultural era initiated by the invention of the wheel, the industrial era marked by the steam engine, and the current AI era propelled by the invention of the chip. While the past three decades celebrated the liberation of IQ through chips, he believes AI has entered a phase of unlocking emotional intelligence (EQ). This burgeoning field promises expansive future potential and demands extended exploration.

Addressing investment opportunities, Zheng highlighted NVIDIA as a dominant player in AI infrastructure. He praised its open architecture and software ecosystem, which together form substantial competitive barriers, positioning NVIDIA to maintain its lead over the next five years.

Illustrating his point with an analogy, Zheng compared Intel’s CPU-centric strategy to an oversized fuel tank. While seemingly efficient, it lacks agility when faced with changing conditions. Conversely, NVIDIA’s GPU strategy offers flexibility, likening it to smaller, adaptable fuel stations managed through their CUDA software, enhancing data processing agility.

Zheng elaborated on how NVIDIA’s hardware and CUDA software ecosystem supports diverse applications, increasing the switching costs and complexity for users to move to other platforms. This ecosystem cultivates a robust user and developer base that thrives on NVIDIA’s technological solutions.

He also commented on the application of AI in companies like Tesla, which leverages AI for innovations such as autonomous driving and humanoid robots, significantly impacting daily life.

Despite geopolitical complexities, Zheng expressed confidence that high-quality products sustain limited long-term effects. He suggested that adaptable supply chains enable companies like NVIDIA to remain competitive, irrespective of potential sanctions or market barriers.

As an external investor for Norway's pension fund, Zheng also noted the critical importance of ESG standards in European investment practices, highlighting the increasing focus on corporate governance and stringent ESG criteria.