How Quantum Computing Will Supercharge AI – And How to Invest

By TradeSmith Research Team

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Artificial intelligence is hot. White hot.

In the last few months alone:

  • AI ignited a stunning earnings report for Nvidia Corp. (NVDA) — launching the chipmaker into the “Trillion-Dollar Club.”
  • AI headlined a product launch for Salesforce Inc. (CRM), letting that company raise prices for the first time in seven years.
  • And Microsoft (MSFT) cashed in on the millisecond-name recognition of ChatGPT to add cachet to its own AI product rollout.
Yeah, AI is hot.

But the stock market is very much a “what-comes-next” game. And tech is a major trigger for stocks.

So knowing “what comes after AI” is how you get that “investing edge.”

That’s what we’re bringing you here today.


The Next AI Supercharger

The Internet was the last generational, paradigm-shifting tech innovation.

And that was in the middle 1990s — so nearly 30 years ago.

Smartphones and “the Cloud” supercharged the Internet.

And quantum computers are poised to play the same catalytic game with AI.

Here’s why.

AI is progressing so fast that it’s rocketing into the upper limit of what today’s hardware can do. In theory, AI developers can dream up the most intricate, powerful algorithms conceivable.

But they’ll remain just that — just dreams — until computers leapfrog in terms of power.

Cue the quantum computers.

They’re very futuristic… but also very “today.”

Just last month, a Google research team declared “quantum supremacy” for its new quantum computing chip, saying that quantum brain can do instantly what would take existing supercomputers 47 years to perform…

All built on a tiny device of just 70 quantum bits, or “qubits.”


As advanced as these “qubits” are, the reason they’re so great is actually simple. All the computer chips we use today still operate in binary mode: 0s and 1s. So, they can only run one calculation at a time: yes or no. But qubits can do yes, no, or maybe. This lets the quantum computer run multiple scenarios/computations at the same time.

Imagine what we can do with a computer that’s a few million times more powerful than what we have today.

Japanese physicist Michio Kaku — a proverbial white-haired professor and an icon in his field — says “the chatbots that are a revolution in software and then quantum computers, which are a revolution in hardware — when they get together, watch out.”

But before you rush out and empty your 401(K) into shares of Alphabet (GOOGL), understand that it’ll take several more years of work before quantum computers are widely available.

That’s plenty of time for people to debate all the big philosophical questions this raises.

For me, I say: Let’s not get bogged down by our feelings about super-powerful AI.

When a major innovation comes along like this, there are only two outcomes: We can either try to beat them — or join them.

When I used to do tech-investing presentations for hedge funds, I’d show slides a lot like the one below — showing the historical progression from the mechanical revolution… to the industrial revolution… to the information revolution… and finally to the AI/data revolution — the “Fourth Revolution.”


That Fourth Revolution has already started.

And I’m inspired by what I’m seeing.

I’m a computer guy — this is what I do. Computers put food on my table, pay to take my wife and kids to Europe, and even college.

Computers do that by finding opportunities.

Opportunities to make money.

Big opportunities like AI. Timely ones — like the strongest sector of the moment. Targeted ones, like quality companies whose shares are being bought by Big Money Wall Streeters.

I look for the best stocks in any market condition. And I find them by running my Quantum Edge system on over 6,000 stocks a day… far more than our “dumb” human brains can handle.

And one day, we will ALL be investing in quantum computing, because this is where we are heading next.

We may as well start to prepare now.


Where Do We Find the Winning Companies for Quantum Computing?

At this point, we can’t predict who the AI winners will be.

It’s too early. And too hard.

But we can approach “the now” with logical rules that help us find the best opportunities — today.

No. 1: Which “Legacy Tech” Companies Are Getting Involved?

If you’ve been hearing about quantum computing in the headlines today, it’s probably thanks to companies like Microsoft.

In June, Microsoft, which has a “vice president of advanced quantum development,” said its team plans to deliver a quantum supercomputer in the next 10 years.

IBM (IBM) says it already has a quantum computer that can run 433 qubits — so, that’s another six times greater than what Google just achieved.

And it’s gunning for a 4,000-qubit processor by 2025.

The other current-day prospects include Microsoft, Google, Tesla (TSLA), and Amazon.com (AMZN).

Basically, if you want quantum computing investments, you can bet that the “Magnificent Seven” companies will be involved in any way they can.

No. 2: Picks and Shovels

Veteran investors all know about “pick-and-shovel” investing — a reference to the California Gold Rush, where a lot of the “strike-it-rich” crowd were the folks who sold mining supplies to the actual prospectors.

With quantum computing, we already know what’s on the “shopping list” of essentials for the builders, including: supercooling.

Researchers keep their quantum computers inside refrigerators — and not the kind made by Whirlpool. These computers are kept just above absolute zero, or minus 459 degrees Fahrenheit.

So, for investments, we can look at the materials these researchers are using — materials like liquid nitrogen.

There are other aspects of the operating environment. Vibrations, or impurities in the chip materials, can cause problems for today’s quantum computers. Anyone making better, faster, cleaner products are worth a closer look.

For now, we’ll keep an eye out for companies that can overcome these obstacles — it’ll happen sooner than you think.

And with my stock system, we’re always sifting out the companies — in any industry — that can line up the fundamental factors and achieve the technical stock characteristics they need to succeed as businesses and investments.