AI is reshaping financial markets, but stocks and bonds are telling two different stories. In this article, Priyank Gandhi, Associate Professor of Finance at Rutgers Business School, explores how companies with greater exposure to generative AI are experiencing higher equity valuations while also facing increased borrowing costs. The research reveals an interesting divide in how investors assess AI’s impact: stock investors are focused on its potential to drive growth and profitability, while bond investors are weighing the uncertainty and risks that come with it.
AI exposure and company valuations: why stocks and bonds disagree
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