D (6:06)

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E (6:36)

So Denny, I love that you led with sort of the vanguard of the investment into artificial intelligence. So the semiconductors, they've been the first initial push for investment. But as we look beyond the near term, obviously this is gonna flow into other sectors of the economy. Everyone's watching the AI data center build outs. For example, you've developed a really nice framework. I think it's called Enablers, Enhancers and End User. And this is also the framework that's employed by the Janice Henderson Global Artificial Intelligence etf. We'll just call it jhai, the symbol for short from here on out. But could you explain this framework and how you're using that to isolate companies that could have promise beyond just this year as we go to three year, five year and beyond periods?

A (7:23)

Yeah, absolutely, and I appreciate the question. So this product was officially commercialized to the public in August of this year, but I actually seeded this product back in August of 2025 so before the ChatGPT moment and actually went to our product committee at the depths of tech despair in 2022 to convince them that AI was going to be a Very, very profound technology shift that we were right on the cusp on. And my original thesis at that point in time was that there were going to be kind of three buckets of companies that were going to benefit from AI. And to your point, it's not just tech, you know, it's the broader economy. This is going to be very profound. And we were going to have phases of adoption. And so we created this framework of enablers, enhancers and end users. And what we mean by that is enablers are as the name suggests. So it's semiconductors, you know, GPUs, ASICs, foundry, semicap equipment, power producers, data centers, data center infrastructure. So kind of a mix of tech, energy industrials, kind of all the stuff you need to lay down to actually be able to train these models and then actually perform inference as we actually put these agents and applications into production over time. And then our view is there's another set of companies we call these enhancers. These are companies that were strong businesses before AI and AI is likely to make the businesses even stronger. But the fundamentals and the impact of those businesses are going to lag enablement. And so enhancers, I kind of think about software, for example. Companies that have developed really strong businesses, have impressive data moats, are critical to their customers, value teams or business processes, and then can embed AI in to those applications to enhance the value proposition to their customers. Also on the consumer Internet side, for example, you know, companies that have very incredible value propositions, but AI is just going to make their engagement stronger and make both their operations stronger as well, both from a digital and a physical standpoint. And that's what we mean by enhancers. I kind of think about software companies and Internet related companies in that bucket. And then end users, you know, pick your poison. It could be health care, it could be financial services, agriculture, insurance. And our thesis here is that there are going to be companies that are already leaders in their industry that are going to extend their competitive advantage because of their aggressive deployment of AI to not only reduce costs but also drive revenue lift. And we're big believers that we're going to see companies that are going to benefit on both sides of that coin. And that's why, you know, yes, why I'm optimistic about the market. I think there's a lot to be optimistic about because of what we could see with AI and what we expect is just over the fullness of time, our percentage of the fun that's in each of these buckets is going to ebb and flow based on where we feel we are in the adoption curve of AI and so that's why we structured the fund that way.

E (10:39)

Yeah, I just wanted to follow up with a question on the lines and how they blur. So between enablers and enhancers, the idea that comes to my mind is Amazon.com is sort of enabler and an enhancer. Where do the lines blur the most when you're categorizing these companies?

A (10:57)

Yeah, that's pretty much where it does blur. I would say the hyperscalers for example, because Microsoft is the quintessential enabler because of Azure. But then they're an enhancer if you think about what Copilot does for Office in their productivity suite and other applications. So those blur the line. But I think where the most valuable values being added right now to the companies is in the enablement phase, whether it's Azure or aws. And so I would consider those more enablement. But over time, clearly you think about a company like Amazon. We think about really what gets all the attention right now is the digital manifestation of AI. When we think about the OpenAI's anthropics and Geminis and how AI is being deployed, that's just the start. The physical manifestation of AI through robotics and humanoids, full self driving automation, things like that, that's going to be really, really profound for companies like Amazon that have a massive physical footprint with fulfillment and distribution and they should get a tremendous amount of efficiencies from that. And like I was talking about this idea of like extending durable competitive advantage. I mean Amazon has built up an infrastructure that is just probably insurmountable at this point. You know, just the sheer amount of capital it would take to replicate that. And then if you're able to do they've done for the last 25 to 30 years, which is just reinvest that incremental margin into making the business better. That's what we're going to see. And they're just going to continue to extend their competitive advantage on the physical side as well.

F (12:36)

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C (13:05)

Hey Denny, we are in the middle of the CES time of the year. So I just wanted to get some reflections on your thoughts on what you heard coming out of CES this week.

A (13:14)

Yeah, I think the biggest thing is pretty much the biggest thing that we had last year, too, and that was Jensen's keynote. And the reason that is is because last year he laid out this idea of three separate types of scaling laws that were important to understand that were compounding effects on each other and why Blackwell was actually going to be able to support the continuation of scaling laws. And this year, it was all about the continuation of that. And now Vera Rubin, which is the next version of their GPU systems. And what's really important about that is these systems, they just get more powerful, but more efficient. And it's this whole idea of how do we continue to extend scaling laws while at the same time driving down the cost of tokens for those that are actually then using the models. And that's exactly what Ruben is expected to do. And, you know, Nvidia just continues to stack its lead in the GPU space. And I think that was probably the most important thing, just giving people confidence that, like, look, if you thought Blackwell was good, wait till Ruben gets here. Okay. And so, you know, so that was big. You know, CES is, you know, 15% in auto show too. You know, every year we continue to see more and more on the autonomous side. And I think, you know, you know, I'm in San Francisco and has spent a lot of time in Phoenix. And, you know, I've been. I've been using Waymo for a long time, and I don't get in an Uber anymore if I don't have to. You know, I love Waymo. It's an amazing experience. I've used FSD from Tesla. It's not nearly as good, but it's come a long way. Still a long way to go because of the path that Elon's taken with machine vision relative to Waymo. But I was just in London and drove around London in, in a car by a company called Wave, you know, which is funded by Softbank, Microsoft and Nvidia. And, you know, we cruised around London for 45 minutes. Driver didn't have to take the wheel one time. And London's pretty tricky, you know, and so I think that's another thing that investors are going to be getting more and more excited about. And. And, you know, so autonomous was interesting and we're starting to see more on kind of the humanoid and robotics side as well that people are getting really interested in. So, once again, I mean, they might have to change the name of CES to like cesai or something. I don't know.

C (15:39)

I think they already have move of in that direction, right?

A (15:43)

Yeah, exactly.

C (15:44)

Austin was kind of joking with us on one of our podcasts, like, where's the consumer part to the ces?

A (15:50)

Totally.

C (15:51)

I can't imagine what the London cabbie, the upper wars they're going to make of driverless tech.

A (15:55)

Oh my goodness.

C (15:57)

When Uber came into London, it was a big deal and I can't imagine the disruption there. You know what's interesting with the ces, with, with Nvidia's pretty prominent show of their driverless technology than the reaction from Elon on.

A (16:08)

Yeah.

C (16:09)

On Twitter kind of commenting a little tongue in cheek on us kind of already doing that. It does start to another showcase of where you see so many of these giants start their frenemies, their competitors in one way, their partners in the other. And you know, you already seen it with the chip providers and Nvidia being big chip providers of the hyperscalers, the hyperscalers developing their own chips and making a lot of progress there, especially in Google and the tpu. So I found that very both entertaining, but also very insightful on kind of how Nvidia is thinking about building out their stack. Especially when you think about robotics.

A (16:40)

Yeah, completely. And I think that's probably what investors underestimate about a company like Nvidia. I mean, it's just a GPU story right now. There is so much that this company is working on and the amount of cash that they're reinvesting back in the business to advance innovation in areas like, you know, robotics and autonomous driving and the number of investments that they've made in other companies that are also pursuing this. And what I also love about Jensen, if he sees something, he'll act decisively. And you look at the deal that they just did with Groq, Groq, which was actually founded by a guy by the name of Jonathan Ross, who was the original inventor of the TPU at Alphabet. And I've met with them several times over the years and was actually really excited for them to come public at some point and invest in them as a public investor. But unfortunately it's part of Nvidia now. So were invested that way. So in some ways now, you know, Jensen's cornering the market a little bit, you know, in terms of use cases through a deal like that as well. So it's a fun time to be in tech. There's a lot of change. There's going to Be a lot of competition. This is where I go back to. We're just going to continue to see more dispersion among the large cap companies based on who's extending their advantage and who isn't. And just look at Alphabet and meta and what happened in 2025. And I think we're going to see a lot more of that in 26, 27 and beyond.

C (18:06)

Denny, how do you think about allocation in general? You have some very large allocated positions in both the AI ETF and the Global Tech and Innovation Fund and then you have some smaller ones. Just talk to us maybe roughly about your thinking around allocation strategies.

A (18:20)

Yeah, we have this philosophy called resilience and optionality where we're trying to position, you know, 50, 60, 70% of the portfolio. Resilient, meaning these are companies we really think we could own for five years. Not saying we're going to, because things can change. We think the range of outcomes are not narrow but not wide. The returns are going to be high and they're innovative management teams and we want to get behind and we'll run those as big positions, strong competitive advantages. Good example. The head of our portfolio is tsmc. Right. I don't care what happens. I don't know if Broadcom wins, Nvidia wins, amd, whatever. Whatever happens, all roads go through Taiwan and now Phoenix because they're going to have like 12 fabs there. Right. And so you find things like that that you can get comfortable with, but then you got to find tomorrow's winners. Right. And those are generally smaller companies that have wider range of outcomes. And so we populate then the bottom portion of the portfolio with companies smaller position sizes and we're going to call that part of the portfolio more because we're going to be wrong. But the hope is we find enough of those companies that then graduate to resilient companies over time that can have a meaningful impact on the portfolio.

C (19:38)

That's great. ASIT calls that his peanut shell strategy. I think Asit, to borrow a little.

E (19:42)

Term from you, you gotta get started somewhere.

A (19:44)

Yeah, exactly.

C (19:46)

Danny, it's been a really wonderful, far reaching conversation and you share your many deep thoughts on tech and investing, your experiences in a. And we really appreciate all that we learned from you. Thank you for joining us here at the Motley Fool.

A (20:00)

It was my pleasure. Thanks guys, that was great.

C (20:03)

Thanks Denny, best of luck to you and the entire Janus team and we hope you have a great 2026.

A (20:08)

Great, thank you. Likewise.

B (20:13)

As always, people on the program may have interest in the stocks they talk about. And the Motley fool may have formal recommendations for against. So don't buy or sell stock space solely. I want you here. All personal finance content follows Motley fool editorial standards. And is not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. To see our full advertising disclosure, please check out our show notes. For the Motley fool money team, I'm Matt Grier. Thanks for listening, and we will see you tomorrow.