AI has become a buzzword in the tech industry, with companies across various sectors investing heavily in the technology. While AI is viewed as a growth driver for the tech industry, investors need to select the right companies for their portfolios, advises Inge Heydorn, a partner on the GP Bullhound Global Technology Fund. Heydorn and portfolio manager Jenny Hardy suggest carefully considering high valuations in some segments of tech that could make earnings vulnerable. GP Bullhound invests in leading global tech companies and manages more than $1bn in assets. Hardy recommends investing in semiconductor firms that supply companies like Microsoft, Amazon and Google for their AI servers. Nvidia, Advanced Micro Devices, Taiwan Semiconductor, Infineon, Cisco, NXP and ServiceNow are among companies in their portfolio. The veteran investors are also bullish on the semiconductor capital equipment industry because of AI’s impact on supply chains, with Applied Materials, KLA, Lam Research and ASML part of their portfolio.