Across Asia, thousands of first-time investors have recently poured into stock markets, hoping to cash in on the massive tech boom that boosted indexes in Taiwan, South Korea, and Japan to record highs earlier this year.

Investing in Tech

A surge of spending on data centers and artificial intelligence is leading to unprecedented profits for companies that supply semiconductors. Asia’s chipmaking giants, such as Taiwan Semiconductor Manufacturing Company, Samsung Electronics, and SK Hynix, have gained more than 50%, 100%, and 150% respectively this year as US AI behemoths like Nvidia race to secure more chips.

However, as dreams of getting rich have grown, so have the dangers of losing it all. Tech stocks in Asia and the United States have swung wildly in recent weeks, at times wiping out billions of dollars as investors question whether the AI boom can justify the sky-high valuations.

Risks and Rewards

With Taiwanese investors also borrowing near record levels, downturns could easily cause panic and forced selling, compounding losses and increasing the potential for a major market crash. Some investors, like Jennifer Ke, a 35-year-old working in operations at a cryptocurrency firm, are taking a cautious approach, while others, like Choi Eun-chong, a 39-year-old professional bodybuilder, have lost significant amounts of money in the market.

The situation has sparked concerns about income inequality, with government officials floating the idea of a ‘citizen dividend’ or public fund to redistribute profits from AI to the masses. Meanwhile, the popularity of stock trading has exploded this year as a quicker means to close the gap.

Original reporting: KEYT (Ventura/Santa Barbara) — read the source article.