BlockBeats News, July 14th - Renowned US Stock KOL Herman Jin stated in his latest market analysis video "Momentum Unwind" that one of the most crowded trades in the market in recent weeks was longing AI physical assets such as semiconductors, storage, optical communication, neocloud, power, and data centers, while shorting software and other old tech assets seen as AI disruptees. As funds began to deleverage, investors were forced to sell off hardware longs with the largest gains and best liquidity, and switch to covering software shorts, leading to a reverse trend of "hardware decline, software rise."

Herman Jin believes that the large-scale ADR listing of SK Hynix was one of the direct triggering factors of this correction. The additional supply required funds that were already heavily invested in AI to take on, forcing some investors to shift positions. The storage sector led the decline, not because the demand for HBM or AI disappeared, but because this sector had seen significant gains, had heavy positions, and had a strong cyclical nature, making it the most vulnerable to sell-offs during fund contractions.

Herman Jin's assessment is that the mid-term fundamentals of AI hardware have not deteriorated, but the short-term trading structure remains fragile. The unwinding of the first-phase long semiconductor, short software trades may be diminishing, but factors such as pure long AI fund reduction, negative gamma, potential CTA selling pressure, and low summer liquidity could still trigger a second round of decline. The real risk to be wary of lies not in the stock prices themselves, but in the credit market. If major cloud players resort to issuing more debt to sustain AI capital expenditures, leading to an increase in financing costs, market doubts about the ROI of AI investments may deepen further and eventually transmit to GPU, HBM, optical communication, power, and data center orders.

It is reported that Herman Jin served as the former Executive Director/Managing Director of FICC (Fixed Income, Currencies & Commodities) at Goldman Sachs Asia, working at Goldman Sachs Hong Kong for over 18 years (since around 2008).