A great week for my Trading 212 portfolio, gaining over £10k in a week!
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| £140k deposited over 2 years shows a £53k uncrystallised profit |
The Hormuz 'memorandum of misunderstanding' helped a lot, and also the US stock market being closed on Friday helped too!
I have set up stop sells on many of my ISA stocks so that should the market fall on Monday, I will try crystalise my profit. I will buy back in when prices are low again.
Invest GIA (IRR 104%)
I made a few minor trades during the week. The main one was to sell Sandisk at $1977 for a quick £60 profit as it looked like it was falling (but in fact it continued to rise another 1%).
Is Tech now overpriced?
We have more AI IPOs to come and the picks and shovels companies (Micron, Hynix, Seagate, WD, Intel, AMD, nVidia, etc.) seem to be back in favour as many people are beginning to think that AI companies and companies who have invested heavily in AI will have problems actually building the data centres, powering them and especially making a profit from them.
There must be an awful lot of memory, disks and CPUs sitting in warehouses that are destined for data centres but they may never actually get used. Higher-end CPUs/GPUs will be losing value as they are superseded by more recent hardware which is cheaper to run and requires less infrastructure.
Large companies who are currently buying AI as SaaS (and paying hefty subscription fees) are now beginning to want to build their own AI servers so that they are in control of their own AI service and cost constraints.
Companies like HP, Dell and Lenovo may be able to pick up the unutilised AI data centre hardware components quite cheaply and sell them on into the retail enterprise server market.
I am very worried that pure AI SaaS providers will never be profitable and they are asking the retail investor market to fund their folly and then sell their shares and leave the retail investors holding the baby. But I could be wrong.
I don't think the large volume AI users care if they use Deepseek, Claude, ChatGPT or Gemini - what they do care about a lot, is the 'cost of compute'. I think the capital costs of AI will come down and the energy costs will come down too as better, cheaper and more efficient hardware is developed. At the moment, the AI 'dealers' are giving us free or cheap, highly addictive drugs. Once we are hooked, we will then become dependent on them. There will be drug wars, but in the end, it will be a price competitive 'commodity' market.
Packaging is the bottleneck!
Although silicon chip factories can produce more wafers, the chips still need to be packaged. Apparently, there is a big bottleneck here, as most chip packaging is done offshore.
Let us look at a few packaging companies...
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| Amkor has grown 358% in a year and shows no signs of slowing down! |
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| ASE (ASX) can be bought only in a T212 Invest account - but it has shown similar growth. |
1. Foundries & IDMs (Integrated Device Manufacturers)
- Taiwan Semiconductor Manufacturing Co. (TSMC): Dominates the market; Nvidia alone has reserved roughly 60% of TSMC's CoWoS packaging allocation.
- Capacity Increase: Growing advanced packaging at a massive 80% compound annual growth rate (CAGR). TSMC is aggressively ramping up two new specialized packaging sites in Taiwan and is establishing an advanced packaging site alongside its Arizona foundry complex to support localized US assembly by 2027. [1, 2, 3, 4, 5, 6]
- Intel Corporation (INTC): Operates extensive internal packaging setups in New Mexico (US), Kulim, and Penang (Malaysia).
- Capacity Increase: Intel is expanding packaging availability to external customers and is qualifying its EMIB-T packaging tech for massive client volume ramps through the latter half of 2026. [1, 2, 3]
- Samsung Electronics (Samsung): Launching a complete "turnkey" ecosystem that bundles memory, foundry nodes, and proprietary I-Cube advanced packaging together.
- Capacity Increase: Building out entirely new HBM packaging infrastructure across South Korea, Taiwan, and Singapore, which are scheduled to scale aggressively through 2026 and 2027. [1, 2]
2. Pure-Play OSATs (Assembly & Test Specialists)
- ASE Technology Holding (ASE): The global OSAT market leader, controlling a 15.2% revenue share of advanced packaging via its robust 2.5D and 3D solutions.
- Capacity Increase: Expanding localized footprints and working in close technical lockstep with TSMC to absorb downstream "on-substrate" chip assembly. [1, 2]
- Amkor Technology (AMKR): A premier US-headquartered OSAT provider focusing on high-density fan-out (HDFO) packaging.
- Capacity Increase: Amkor has tripled its global capital expenditures budget. Its massive new manufacturing campus in Peoria, Arizona broke ground late last year and is accelerating tool installations to begin active production by mid-2027 to package US-fabricated chips. [1, 2, 3, 4]
3. Equipment Suppliers (The Hidden Enablers)
- ASML Holding (ASML): Historically a lithography leader, ASML is seeing an aggressive revenue surge from selling tools tailored toward advanced packaging and heterogeneous integration.
- Capacity Increase: Ramping up production across two new US manufacturing locations and breaking ground on a major campus expansion in Eindhoven to push out backend tools faster through 2027. [1, 2, 3]
- ASMPT (ASMPT): A major listed supplier in Singapore specializing in advanced die-bonding systems.
- Capacity Increase: Booking out its manufacturing pipelines through 2027 as foundries struggle to acquire the high-precision hybrid bonders necessary for modern 3D stacking. [1, 2, 3, 4]
2. ASE Technology Holding Co. (ASX) — The Pullback Leader [
1]
- The Rationale: ASE is the definitive giant of the OSAT landscape, executing roughly 45% of total elite backend revenue. Because it is a massive structural asset, it has absorbed incredible capital inflows. However, it recently experienced healthy, brief technical pullbacks, taking the short-term froth out of its price. [1, 2, 3]
- Moving Averages: It dropped below its short-term 20-day exponential structures, turning neutral on basic technical indicators like the Relative Strength Index (RSI). This localized "cooling off" makes it an incredibly attractive buy point for long-term investors entering the cycle. [1, 2]
- The Play: Accumulate shares immediately as it validates technical support. It offers the safest institutional-grade exposure to TSMC's downstream overflow. [1, 2]
2. Amkor Technology, Inc. (AMKR) — The Sovereign Security Premium [
1]
- The Rationale: At a trailing P/E of ~51.3x, Amkor is certainly not cheap historically. However, it is fundamentally underweighted when considering its unique geopolitical position as the premier US-onshored advanced packaging facility. [1, 2, 3]
- Moving Averages: Amkor features strong momentum, trading roughly 26% higher than its 50-day SMA and nearly 89% above its 200-day structural baseline. While this signifies a clear extension, the aggressive volume profile suggests institutional accumulation. [1, 2]
- The Play: This is a "growth at a reasonable price" narrative within the AI architecture sphere. Rather than buying a full position all at once, utilize a dollar-cost averaging approach to build exposure over the quarter to protect against near-term macro sector volatility.
I will track these two (
ASX and
AMKR) and dollar-cost average into them over the next month or so. I will use top-sliced profits from other shares to provide the cash.
AMAT - Financial Impact of the ASMPT NEXX Buyout
Applied Materials (
AMAT) recently purchased $120m of older packaging technology from
ASMPT.
Wall Street has largely looked past any minor near-term drag. Analysts see the integration of NEXX's large-format electrochemical deposition (ECD) tools as a structural growth catalyst. It expands AMAT’s total addressable market within the $3.5 billion advanced packaging equipment sector, positioning the company to capture larger, high-margin package deals for 2027 server designs
My investment in AMAT seems to be paying off (88% gain), hopefully there is still more growth to come...
My thematic investing in 'picks-and-shovels' tech companies has so far paid off, let's hope there is no crash to follow!
