Questions about a possible market bubble have resurfaced this year, driven by rapid gains in AI-related companies and concerns about whether valuations can keep pace with expectations. Families are asking whether today's environment resembles earlier periods of exuberance and what that might mean for long-term positioning.

In a previous episode of The Wealth Enterprise Briefing, Managing Partner Michael Zeuner and Global Head of Macro Sam Sudame explored a question many families are asking: Are we in a bubble, particularly in AI-related stocks? Sam's view was clear: Current valuations remain grounded in fundamentals, with earnings growth supporting much of the recent market strength.

In this follow-up discussion, they take the conversation a step further. Instead of focusing solely on whether a bubble may eventually form, they examine what AI could mean for the broader market over time and how investors might think about positioning for the next stage of this shift.

They talk through:

• Why long-term opportunities may extend beyond hyperscalers and early AI leaders
• How historical cycles show that productivity beneficiaries often drive the next leg of returns
• What distinguishes today's environment from the dot-com era, particularly around fundamentals and cost efficiencies
• Why margin expansion across a wider set of companies could shape future market leadership
• How diversified portfolios can capture AI-related growth while balancing other risks

Sam notes that AI is likely at the beginning of a multi-stage cycle: first through infrastructure buildout and next through widespread corporate adoption that could lift productivity and margins. While sentiment may play a role in the near term, the long-term impact of AI could reach far beyond the companies currently in the spotlight.

If you would like to review how AI-related developments are reflected in your current allocations, please contact us; we're here to help.

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