Sohn投资大会2026做空圆桌

So, I'd like to take the rest of our time and talk to the panelists a little bit in light of the speculative environment of the markets, and also sort of a bifurcation that's occurring in the markets between AI and certain tech spending and lots of other stocks that are kind of going nowhere or going down. Where are you finding—and I know you're not thematic investors, all 3 of you. You're all stock guys and girls—but where are you finding interesting places to look? Joyce, you mentioned something you kind of avoid. Where are you basically avoiding in the current market? Joyce, why don't you start?

1. Fake AI Creates Short Opportunities

Yeah, definitely. I think the reality is that, for shorts, we always look for variant perception and a catalyst. We are a little bit more thematic in our shorts because we think a rising tide lifts all boats, and a cresting tide takes down a lot of names in the same neighborhood.

One of our favorite themes, especially in a market where you have an AI frenzy and everyone is trying to jump into it, is fake AI. We've been short a Chinese company that used to be a home decoration company and turned into an AI server company. They Photoshopped NVIDIA's product catalog to put it on their website and said they hired some people. We looked them up on LinkedIn, and they did not have the people they claimed.

There's just a lot of that. One of our favorite screens, and how we found Resolve AI, was name changes that suddenly had AI in them. We actually think it's a really rich market environment for shorts. Our short book is up this year, and we've had positive short performance from the fund's inception.

I do think that, thematically, trying to find where there's excess—where people claim something is good and claim they have it, but actually don't—is a really rich ideation opportunity for us. You can ballast it with secular decliners that don't have the same volatility as some of these spicier shorts.

Got it. Soren?

2. Boring Shorts Beat AI Hype

I think our best shorts this year have been in the more boring areas—avoiding the topless parties, basically. Things like agriculture. If you look at the breadth of the rally, the breadth of the rally is really narrow, right? It's just a few stocks that are ripping. Actually, the modal stock is down. The performance, if you look at the wider market, has been really tough.

We think that's pretty emblematic of 1999 and 2000 and what it looked like back then, at least based on our study of it. In that context, some of the more boring stuff has actually been working really well. We've got a couple of shorts in the agriculture field where we're looking at the closures of the Straits of Hormuz and what's happening in chemicals.

Look at the prices of fertilizers and sulfates around the world. That has consequences in the supply chain. That has consequences for how growers and farmers plant. It's going to show up in companies that you've probably never heard of and that certainly someone in their mom's basement with a wife-beater on is not blogging about on Twitter.

It's just avoiding those types of high-retail, high-Twitter, a little bit more boring shorts that have actually worked for us this year.

Yeah, Zach?

Yeah, definitely avoiding AI, right? I mean, avoiding AI has been a good place to start. I think we've mostly avoided AI, and we've done pretty well from the shorts this year as well. We're up on an absolute basis as well.

3. Private Capital Faces Scrutiny

I think what's interesting is that we follow the capital cycle a lot, and we do some thematic shorts. The one that people are talking more about is probably what's going on in private credit and private equity. There's been a lot of money going there for a very, very long time, and I think the story has changed a little bit.

People are looking for proof in the pudding, and there are interesting shorts to be done in that space as well, but also in the areas where they've gotten involved. What ends up happening is that they find something that's very, very interesting and then they just pile in, basically.

For instance, Mister Car Wash—I think that's one you've talked about in the past. It's an interesting company. Car washes are really, really good businesses, but if there are 3 opening up within a 1-mile radius, all of a sudden it's not a good business.

We're finding more and more of that: something that was a very, very good business, a very steady business, with excellent customer dynamics and low customer acquisition costs is all of a sudden beginning to look like a much, much worse business because so much money is piled in. You don't get to see that, right? These are private companies, and all of a sudden they have lots of locations and lots of revenue. Competition just works over the long term.

There are even publicly traded companies that have private equity components. An old name of ours, Planet Fitness, has been down this year because private equity companies owned the gyms and felt the need to expand, but the unit economics were terrible. They cut back on the expansion, and the growth story fell apart. Private equity works its way into some of these companies in interesting ways.

Are you looking at any of the private equity sponsors or the BDCs?

Oh, we're looking at those, too. There are obviously some very, very interesting numbers out there. If you look at what the Street expects for assets under management for many of these companies, it's just—these are enormous numbers, enormous numbers.

I think Brookfield has over $1 trillion of AUM with negative tangible equity. Just to size that, the entire high-yield market in the United States is $1.5 trillion. All of a sudden, you have these companies that are going to manage more than the high-yield market. That's very, very interesting to us.

Obviously, there is no underlying accounting. These companies are not lying, but what's interesting about that is just—

It's a simple business. You take money off the top, right?

It might not all be accurate, but other than that, you know. They're relatively simple businesses. I think people have gotten carried away with how well this business can do with a lot more money.

Joyce, U.S. or Asia?

4. Asia Broadens The Short Book

We do both, actually. Our fund is over 50% international, and we have a lot in China, greater China, and India.

Good. On the margin, more in Asia these days or more in the U.S.?

Asia has done really great. I think we own a lot in the AI supply chain, so we own real AI against fake AI. But I also think Asia is an area where it's very easy to get some information asymmetry, especially given sometimes poor reporting standards and business-quality inflation metrics and things like that.

China, especially, is usually a very exciting place to find shorts. Where we're focused right now is both secularly declining businesses, because terminal value is being repriced, and the AI cycle is really fast in China.

There's always an opportunity to find some unique company that does something weird and then gets a big valuation, and you can always short that. For us, it's all single-name, individual-name ideas. With tech cycles, what people underappreciate is that a 1% change in terminal growth rates can swing your DCF by 8% to 15%.

If you can find terminal-disruption stories, especially in legacy software and business services—and we have a lot of that both in the U.S. and Asia—in India, a big services economy, you can imagine how meaningful that would be for the economy, especially in commoditized BPO and contact centers and things like that. We've made a lot of money on large shorts there.

You get the asymmetry to the downside because, to the point of micro themes, it's a very tough space.

5. AI Threatens Incumbent Profits

You talked about fake AI companies, but I want to broaden that out a little bit. Since this is a glass-half-empty panel, and we're going to hear about AI all day, where do you think AI may disrupt, much like the Internet took analog businesses that were in the business of making or distributing an analog product and just crushed profit margins as the cost of a bit and the cost of transmitting a bit went to 0?

AI may very well do the same thing in a lot of businesses. Are you thinking at all about that, looking out a handful of years—the ultimate disruptive power of an amazing technology? Soren, I'll ask this question of all 3 of you to take us home.

Yeah, I agree. Capitalism destroys as well as builds. At our fund, we're very much students of history. The analogs that we look for are not only the Internet, but also railroads in the 1850s. We look at revolutionary technologies that changed the way the world operates, the way commerce and capitalism are organized, and the way society is organized.

Yet that also was responsible for the bankruptcy of many of the firms and funds that traded at very high levels. What investors sometimes confuse is that they look at Claude and say, “Holy smokes, this is going to change the way that I do business,” without recognizing that the same was true with railroads and the Internet.

Despite the life-changing and society-changing impact, it still resulted in a massive market bubble, and it resulted in a lot of the companies that were the early purveyors of these things going completely bust.

And that's the lens with which we're trying to approach our shorts, basically. Jim Chanos

I would point out, before Zach, you answer, that we took a look at U.S. GDP growth in the 10 years prior to Netscape and the 10 years post-Netscape, basically 1997 to 2007. We didn't penalize it for the GFC, and U.S. GDP growth was exactly the same in both periods.

Corporate profitability growth, measured by the S&P, was also exactly the same: 1986 to 1996 and 1997 to 2007, at about 6% compound annual growth. So, there's no doubt the Internet changed many things. It didn't have a super-huge impact. The opening up of China, for example, had a much bigger impact than the Internet did, interestingly.

Zach, why would you answer that question?

I mean, definitely, there's a lot of change, right? It's very visible. The way we used to do work two years ago versus a year ago versus now is very, very different, so everyone's doing their work very, very differently.

6. Software Faces Instant Competition

Take an easy one. I think we did this about two or three months ago. We looked at the software universe, and there were 145 software companies around the world, at least back then, with a billion-plus market cap. I mean, 145 doing some little thing. Some of them are as big as CRM and SAP; others are much, much smaller, doing something much, much smaller.

When you think about the dynamics of what's happening in software, what happens? Let's say company X does sales force automation and company Y does sales force automation. All of a sudden, if I'm a customer and I'm saying, "Well, I really wanted this feature, and before I was going to turn off the one that charges me $1,000 and buy one for $2,000 that really had that feature," the one that charges you $1,000 can make that feature you want literally overnight, right?

That has a massive effect on everything, because everyone all of a sudden is competing with everyone else. Where this goes, I don't know, but that's not a great dynamic, right? I'm sure you can keep going with that, right?

The services are very, very interesting. What is service automation? What do consultants do? There are lots of really, really interesting questions that this opens up, and I think you have to keep an open mind about how things are changing. The nature of work is changing in very big ways.

Joyce, last words.

Yeah, I echo a lot of the things that have already been said. I do think that software has 80%-plus gross profit margins, and creating code is no longer as much of a competitive advantage, especially if you're a point-solution, light-touch application that's front-office-facing. For services, it's massively potentially deflationary in terms of hours, and so it becomes a very difficult question of price elasticity.

When the market is uncertain, you will see valuations follow earnings cuts or out-year earnings revisions. We think a lot of the bellwether names have already de-rated. So, in business services, we like the niche-ier stuff that's a little hidden. If people have crushed FactSet, why not Morningstar? We like looking at those where there's less coverage, not that much short interest, and you can play that commoditization of data, especially since it's so easy to scrape and get that.

But the second thing I think about AI labor is, to the point you mentioned about productivity, the internet didn't really impact jobs or labor the same way that China did. I think what's unique about AI is that it's creating output that maybe is better than the bottom 25th percentile of that. And the white-collar knowledge worker, which is 45% of the U.S. population, especially in those more core, commodity, replicable services—what's the future for that?

A broader short theme we've been doing is the K-shaped economy. Consumer has been tough, especially with this Iran war and gas prices. But at the lower end, especially in lower-end white-collar work, which is different for the first time, right? Versus blue-collar work, where everyone quit their job to become a plumber. I think that is something that's still to be determined.

If it's overbuilt—and we know these always end up overbuilt—but it might take years. You don't know the duration. Sixty to 70% of the additional compute being built is substituting for human capital. We've seen some of the big layoffs in the tech firms, and these are higher-paying jobs, right? The white-collar jobs that people actually went to school for.

So, I think it's a fundamental change. No one knows yet, but I think it's a really rich environment for long-short spreads.