Biel on Quality, AI Capex Risks, and Balanced Portfolios (with Tom Keene, Paul Sweeney)

Julie Biel advises focusing on quality in small and mid-caps. She views the new Fed chair's 'austerity of words' as positive. She is enthusiastic about AI long-term but notes the shorter depreciation cycle of AI capex creates pressure for near-term returns. She sees US/non-US valuations more balanced now and recommends a globally diversified portfolio.

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Kayne Anderson Rudnick 7.8
Asset Manager $50.00B
Julie Biel 7.5

Biel on Quality, AI Capex Risks, and Balanced Portfolios (with Tom Keene, Paul Sweeney)

ndx

Enthusiastic and excited about AI for the very long term.

1 calls

no reliable edge (random outcomes)

11/7/2025 9:54:04 PM	medium term cautious down	21 days later	-1.05%	+0.52%

rut

Opportunity to buy nice things (quality small/mid-caps) for cheap.

3 calls

no reliable edge (random outcomes)

6/13/2026 1:33:00 AM	short term cautious up	7 days later	+1.21%	+0.61%
5/19/2026 1:47:58 AM	short term cautious down	5 days later	+1.84%	-0.92%
5/1/2026 1:10:20 AM	short term cautious up	7 days later	+2.67%	+1.33%

Show all 3 rut results

Julie Biel

In small and mid-cap, focus on quality. Low quality to high quality spread is extreme, creating opportunity to buy good companies at better prices.
Julie Biel

The new Fed chair's 'austerity of words' is positive for markets as it reduces noise. Reducing the balance sheet is positive as it provides ammunition for future stress.

The hawkish tone was in line with expectations.
Julie Biel

In portfolio allocation, credit looks good. Be mindful of quality and avoid over-levered businesses. The AI trade now involves more debt and equity, shifting focus to fundamentals and earnings, not just growth.
Julie Biel

Enthusiastic about AI long-term potential, but the current capex build-out has a shorter depreciation and utility than past cycles (e.g., telecom, railroads), creating pressure for near-term returns.

This is a different dynamic than other capex cycles.
Julie Biel

US vs non-US valuations are more balanced now. The deep value opportunity in Europe is less compelling. However, having international exposure makes sense as a hedge against US over-leverage to AI.

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