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Tesla - Greater Opportunity Than Nvidia for AI

Tesla is a greater opportunity than Nvidia, according to Cathie Wood, saying the upside surprises for Tesla will be much more than Nvidia.


Tesla - Great Opportunity Than Nvidia

According to Cathie Wood, head fund manager for Ark Invest, Tesla is a greater opportunity than Nvidia for the future.

This may be considered a controversial statement as Cathie Wood has been seen selling shares of Tesla in her Ark funds - and there is a reason for the selling.

The reason is that no stock can be greater than 10% of her total fund in order to reduce risk. This has people outraged on as they wonder why she keeps selling. As long as Tesla goes up in price, there will be sales of Tesla and if it goes down much more, there will be buys. This pattern will continue over time.

If Tesla were such a great opportunity, why does she sell - the 10% allocation is the exact reason. If she didn't believe in Tesla, it wouldn't be in any of her funds. I think it's better to just buy the stock individually rather than one of her ETF funds if you believe in Tesla, personally.

What makes Tesla such a great company - even better than Nvidia? Let's discuss that now.

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Tesla AI -vs- Nvidia

Nvidia is a company producing video graphics cars for AI companies. Think of Nvidia as a supplier of the power source for AI. Nvidia isn't producing much software for AI that I am aware of, but they most certainly are providing hardware, and that hardware need will only keep increasing.

AI is definitely here to stay, and Tesla is at the forefront of real world AI. Real world AI deals with processing things you see in the real world, in the same way that your human brain and eyes see the world. Eventually, Tesla AI will pay more attention to sounds and in the future, I believe Tesla AI will be able to recognize smells of things and be able to react to them.

Tesla is software for AI and Nvidia is hardware for AI. Both are in high demand, but the software for AI is much more scalable, and here's why.

Nvidia can make graphics cards for AI companies and that is great. However, that hardware isn't finite and limited - it isn't being trained to get better, just getting better over time through Moore's Law.

Tesla's real world AI is infinitely scalable due to the exponential learning curve that happens as more and more cars and robots interact with the real world. Eventually, there will be hundreds of millions of Tesla vehicles on the roads gathering data. This is when Tesla FSD will be a super human driver and do things that make it seem like it has a 6th sense. Right now, we have about 5 million Tesla vehicles on the road.

When the Tesla Bot comes around and there are hundreds of millions of those, the training data set will be massive and Tesla will be able to very quickly train its humanoid robot on whatever task is needed. It all comes down to the data and then uploading that software to all the cars and robots.

This is why I also like Tesla over Nvidia. Imagine hundreds of millions of cars along with hundreds of millions of Tesla bots in the world taking care of things that are mundane and dangerous, like driving, cleaning, waste management, or high-rise building construction. It boggles my mind how big it could all get.

In Other Tesla News: Why Tesla Prices Are Right Where They Should Be

What do you think about Tesla -vs- Nvidia? Would you take Tesla over Nvidia?

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Jeremy Johnson is a Tesla investor and supporter. He first invested in Tesla in 2017 after years of following Elon Musk and admiring his work ethic and intelligence. Since then, he's become a Tesla bull, covering anything about Tesla he can find, while also dabbling in other electric vehicle companies. Jeremy covers Tesla developments at Torque News. You can follow him on Twitter or LinkedIn to stay in touch and follow his Tesla news coverage on Torque News. Image Credit, Tesla, Screenshot