GS Basics: Edge vs Data Center, Task Per Watt, Momentum vs Low Volatility

This report highlights a shift in the AI trade toward 'task per watt' efficiency, emphasizing local edge compute and usage-based pricing over centralized datacenter reliance. It also identifies record-high momentum vs. low-volatility stock spreads as a potential risk factor.

Key Takeaways

• 1.The AI trade is shifting focus from raw compute scarcity to 'task completion per watt and per dollar,' favoring local edge compute and optimized inference.
• 2.Hyperscalers are converging on usage-based pricing models for AI, pushing customers to optimize for costs by moving routine tasks to local open models.
• 3.The ratio of S&P 500 momentum vs. low volatility stocks has reached Tech Bubble levels, signaling potential concentration risk.

Table of Contents

• Markets
• Task Per Watt
• Hyperscalers
• Edge Over DC
• Oil
• Risk

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