Philippe Laffond is not too worried about the AI jitters that have recently penetrated the market, but says he is primarily focused on specific areas of trading that offer the best exposure at better value.
The billionaire founder of Coatue Management, a technology-focused hedge fund, recently shared his thoughts on the AI market with CNBC. Lafont said he believes the most opportunities lie in the half-cap space of the technology sector, citing companies that provide critical components to chip manufacturing plants.
“If I’m a supplier to a factory, I don’t have to bet on exactly which chip will win,” he said. “That’s kind of why we own sub-small cap stocks.”
The term semi-cap refers to semiconductor capital equipment stocks, companies that sell the machinery, tools and systems that chip manufacturing factories rely on to build AI-enabled hardware.
Demand for these processors, especially memory chips, is skyrocketing, but Laffont says the best way to ride the AI boom is to adopt a classic “pick-and-shovel” strategy, rather than trying to identify which chipmaker is best positioned to maintain that advantage.
“Sometimes you can get some of these stocks through other stocks, and sometimes you can make a lot of money while thinking about who’s taking the risk,” he said. “For me, I think at the end of the day, you have Nvidia, you have Amazon with their training chips, you have Google with their TPI chips, you have some newcomers on the GPU side, and at the end of the day, they’re all going to need the same machines.”
Lafont didn’t give any examples of half-cap stocks that he was particularly bullish on, but he did reveal in May 2026 that the fund held a key position in ASML Holding, a Dutch company that makes lithography equipment used by chipmakers.
According to the May 2026 13F filing, Courtue owned approximately 496,234 shares of ASML stock. The stock has had a strong year in 2026, up 52% since the beginning of the year. Other half-cap companies in the company’s portfolio include Applied Materials, which makes the software and equipment needed to make chips, and Lam Research. Both stocks have increased more than 100% since the beginning of the year.
While these half-cap stocks have performed well, Laffont also highlighted the potential for the company to hold flexible positions that can be exited quickly, especially in the current market.
“One of the benefits of investing in technology is that the market is very liquid,” he said. “From a portfolio perspective, I always try to hold positions that I can change my mind about if something changes.”