Financial investment company Saxo Markets: US market valuation is high, Asia is a more ideal place to bet on the AI boom.

According to Saxo Markets, investors seeking to bet on the hot artificial intelligence theme should look for opportunities in Asia, as the valuations of US technology companies have been pushed higher. "Asia provides a cheaper and more anchored path to ride the same mega trend," Charu Chanana, Chief Investment Strategist at Saxo in Singapore, wrote in a report. "Around 70% of chip manufacturing, 90% of AI storage, and almost all advanced packaging capacity are in China Taiwan, South Korea, and Japan, making this region indispensable to the AI ecosystem." She added that in comparison, US technology stock valuations are high, and companies face risks such as concentration and closed-loop effects. Data shows that the S&P 500 information technology index has a price-to-earnings ratio of close to 30 times future expected earnings, while the corresponding multiple for the MSCI Asia Pacific information technology index is 17 times.