supercharged

Nvidia (NVDA 0.86%) has been one of the most successful stocks in the artificial intelligence (AI) arms race, rising 1,130% since it began at the start of 2023. This has delivered long-term investors phenomenal returns, but there’s a new, exciting investment trend in town that could disrupt how investors view Nvidia’s success.

Quantum computing is one of the most popular industries to invest in, and its stocks have surged over the past few months as investor sentiment surrounding the industry has improved. One of the most popular options is IonQ (IONQ -3.92%), which is no stranger to success. If you’d invested in IonQ instead of Nvidia at the start of 2023, you’d be up 2,150% (at the time of this writing)!

That may have some investors thinking they’ve backed the wrong horse in the computing race. So, is it time to move on from Nvidia and scoop up shares of IonQ? Let’s find out.

Image source: Getty Images.

Nvidia and IonQ are similar businesses

At their core, Nvidia and IonQ are quite close in terms of business pursuit. Nvidia makes graphics processing units (GPUs) alongside other equipment to optimize their performance. GPUs have become the gold standard in high-performance computing applications such as artificial intelligence, drug discovery, engineering simulations, and cryptocurrency mining. Their unique ability to process multiple calculations in parallel makes them a computing powerhouse, and AI hyperscalers have widely deployed them to train and run generative AI models.

IonQ appears to be a much earlier version of Nvidia, focusing on quantum computing rather than traditional computing methods. It’s developing a full-stack solution that provides clients with everything they need to run a quantum computer. Once quantum computing becomes mainstream, many believe it can have widespread use cases in applications like AI training and logistics network improvements. This could lead to a massive market opportunity, similar to what Nvidia experienced at the start of the AI arms race.

However, we’re still a ways away from quantum computing becoming relevant. IonQ and many other quantum computing companies point toward 2030 as the year when quantum computing will become a commercially viable technology. That’s five years out, and there’s still a lot of time for things to go wrong for IonQ (or go right).

IonQ competitor Rigetti Computing estimates that the annual value for quantum computing providers will reach $15 billion to $30 billion between 2030 and 2040. Should IonQ replicate Nvidia’s success by 2030, it could still have room to grow between now and then.

If we assume that the market reaches $15 billion annually in 2030 and IonQ replicates Nvidia’s dominant 90% market share and 50% profit margin, IonQ would be producing profits of $6.75 billion. At a 40 times earnings valuation, that would indicate IonQ could be a $270 billion company, more than a 10x from today’s $23 billion valuation.

But is that enough to warrant selling Nvidia shares to invest in IonQ?

Nvidia has a growth trend of its own

Over the next few years, capital expenditures relating to AI data centers are set to explode. Nvidia estimates that total capital expenditures in 2025 will total $600 billion, but reach $3 trillion to $4 trillion by 2030. If that plays out like Nvidia projects, the total amount of money spent on data center capital expenditures will rise at a compound annual growth rate of 42%. If Nvidia’s growth directly follows that trajectory, that means its stock could rise nearly 6 times in value.

So, which is more likely: Quantum computing becomes viable, IonQ establishes a dominant, Nvidia-like market share and achieves incredibly high margins, or Nvidia’s growth follows widely accepted AI spending trends? I think it’s more likely that the AI arms race continues in its current form, making holding on to Nvidia shares a smart decision. After all of the quantum computing investment hype, I think it’s time for investors to take a break from this sector and focus on some companies that have actual money flowing into them, rather than quantum computing-specific businesses like IonQ.

Investing in the stock market is one of the most surefire ways to build life-changing wealth, and the right investment can transform your savings.

Owning an exchange-traded fund (ETF) is a fantastic way to gain exposure to high-growth stocks with minimal effort on your part. A single ETF can contain dozens or hundreds of stocks, and you’ll own a stake in all of them by owning just one share of that fund.

If you’re looking for a high-powered ETF with a history of earning significantly above-average returns, the Vanguard Information Technology ETF (VGT 0.29%) could potentially turn just $100 per month into $2 million or more over time. Here’s how.

Image source: Getty Images.

A simple way to invest in tech stocks

The technology sector has a long track record of outperforming the market, and investing in a tech-focused ETF — like the Vanguard Information Technology ETF — can make it easier to invest in these stocks without having to research dozens of individual companies.

One of this ETF’s major strengths is its balance between industry-leading giants and smaller corporations. Around 44% of this fund is allocated to Nvidia, Microsoft, and Apple — the three largest holdings by a substantial margin. But it also contains an additional 313 stocks from all corners of the technology sector.

Major companies like Nvidia, Microsoft, and Apple are often more stable than their smaller counterparts. While they can still face significant volatility during economic rough patches, they’re very likely to recover and go on to see positive total returns over the long term.

Up-and-coming companies can be shakier than the industry titans, but these stocks also have more potential for explosive growth. If even one of them becomes the next tech powerhouse, investing now could set you up for substantial gains.

Building a $2 million portfolio

There are never any guarantees in the stock market, and past performance doesn’t predict future returns. That said, it can sometimes be helpful to look at historical returns to get an idea of roughly how much you might earn with a particular investment.

Over the last 10 years, the Vanguard Information Technology ETF has earned an average rate of return of more than 22% per year. For context, the market itself has earned an average return of around 10% per year over the last 50 years.

Again, this ETF may or may not continue earning 22% average annual returns. So to play it safe, let’s assume that going forward, you could earn either a 22%, 16%, or 11% average annual return. If you were to invest $100 per month, here’s approximately what you could accumulate over time.

Data source: Author’s calculations via investor.gov.

To build a portfolio worth $2 million or more, you’d need to invest consistently for around 30 years while earning returns in line with this ETF’s 10-year average. But even if you can’t invest that long or this fund underperforms in the future, you could still rack up hundreds of thousands of dollars over time.

Keep in mind, too, that if you decide to invest in this ETF, double-check that the rest of your portfolio is well-diversified. While this fund has a diverse assortment of tech stocks, investing in just one sector of the market — especially an industry as volatile as tech — increases risk.

Technology ETFs can supercharge your net worth with next to no effort on your part. By starting early and investing consistently, the Vanguard Information Technology ETF could turn small monthly contributions into millions.

A SUPERCHARGED pre-war Alfa Romeo “classic sportscar” Torpedo is being put up for auction and could sell for more than £3.75m.

This could make it among the world’s most expensive cars, when aligned with pre-auction estimates.

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The Alfa Romeo 8C 2300 is a sports car that dominated in racing during its time in the 1930s, establishing new standards for high-performance cars.

It captured multiple wins at the 24 Hours of Le Mans and the 1000 Miglia, leading the Alfa Romeo to sell a street version of the vehicle.

The 1933 Alfa Romeo 8C 2300 Torpédo will be up for grabs at the Gooding Christie’s Pebble Beach Auctions from August 15 to 16.

This one features original open coachwork by famed Parisian coachbuilder Joseph Figoni, with desirable Monza cowl.

As a bare chassis, these vehicles were available on the road in both short and long-wheelbase models, with coachwork that could be commissioned by the customer.

It could be done through firms such as Touring, Zagato, and lesser known Carrosserie Figoni, that provided a high quality build, fine woodwork, luxurious interiors and elegant styling.

Figoni is said to have outfitted seven road-going 8C 2300s between 1932 and 1935 on a built-to-order basis.

The striking two-seater Torpedo that is displayed on the 1933 vehicle was ordered to Paris by Alfa Romeo’s first owner, Louis Jeantet.

It includes a rare Alfa Romeo Paris badge, a folding soft top with exposed bows, long fenders, a separate trunk, and dual-mounted spares.

French luxury car authors, Peter M. Larsen and Ben Erickson, described the car as having: “A body that would be plain from the hand of any other carrossier, but its austerity is alleviated by handsome and perfectly balanced proportions that achieve an understated yet exciting look…

“It is a classic sportscar style conceived at the cusp in time just before aerodynamic thinking changed car design forever.”

There are no side windows on the cars vody, or curtains, beltine or other ornamentation.

Nevertheless, the 8C 2300 boasts an all-aluminium 2.3L twin-cam straight eight that is supercharged to produce 138 horsepower.

It has been dubbed the “premier prewar Italian sports car”, with 140 BHP at 4,800 RPM.

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Last year, another iconic Le Mans racing car hit auctions, and was expected to sell for an eye-popping £7million.

It was a 1954 Jaguar D-Type, that clocked a blistering 172.97 miles per hour.

And earlier this year, another rare Alfa Romeo supercar was bought by a British man to impress his wife on their 1956 honeymoon.

He bought an Alfa Romeo 8C from 1932, for £3million at auction.