From AI FOMO to Fee Fatigue: Investor Sentiment 2025

To put that into perspective, look at Nvidia, whose market cap has risen to $4.6 trillion. It is trading at around $188, up from about $14 at the end of 2022 when the GenAI wave started rolling. Meanwhile, Vertiv is often touted as an “undiscovered gem” that makes advanced cooling solutions for data centers. With a market cap of just below $50 billion, Vertiv is much cheaper than Nvidia. It was last trading at $164, making it only slightly less “undiscovered” than Nvidia.

3. Is my money manager missing the GenAI wave?

“I look at what is going on in GenAI and worry that my money manager is not investing heavily enough in this megatrend: GenAI ETFs are beating the pants off the NASDAQ. GenAI is already having seismic effects on my job, and it’s only just begun. Google is rolling out real-world products that we can use today. For example, I just added Gemini to my marketing company’s Google Workspace. Is my money manager missing another wave while it is still forming?”

My advice: Some tech analysts I spoke with pointed out that GenAI is already transforming how people work: by 2030, most computer code, most advanced semiconductor chips, and many successful drugs will have been written, designed, or discovered with the help of GenAI. This will likely add more than $1 trillion to the global economy. It is expected to become ubiquitous in the global call center/CX industry and at marketing firms like yours. There are perhaps 100 million people working in those industries. At about $500 per year for basic GenAI tools, we’re talking $50 billion. If we throw a 20x forward P/E multiple at that, it would be worth over a trillion dollars.

The only problem is that this is already priced in. The combined market cap of leading publicly traded AI companies (Microsoft, Nvidia, Google, Amazon, and perhaps Meta, Apple, Tesla and Oracle) has risen to almost $22 trillion in October 2025, suggesting that most are expecting well over 100 million paid daily users.

If the number of people paying for and using these tools rises to 100 million by 2028, the value of a GenAI ETF would likely decline. And if the number of paid daily users rises to 200 million to 300 million (or about just a quarter of all knowledge workers today), the value of GenAI ETFs would remain flat.

For this “wave” to still be forming, more than half the 1.1 billion knowledge workers would have to buy GenAI tools. Is that possible? Early evidence shows that while many workers like playing around with these tools, they and their CFOs don’t see enough value to pay for them. A recent study suggested that 95% of GenAI pilots in companies are not boosting revenues or cutting costs as expected. Although about half of consumers have used GenAI tools at some point, the percentage who use them daily is still less than 10%.

While GenAI revenues may continue to grow over the next few years, GenAI stock valuations may not. Therefore, the GenAI promise appears to be baked into their share prices.

4. How important are investment fees?

“My husband and I are busy professionals with two young kids. We don’t want to manage our investment portfolio. The good news is, we are rapidly building up a solid nest egg. We outsourced the management of our investment accounts and hired a financial planner a few years ago. He charges us a flat fee of 1% for advice, and he structured a portfolio of mutual funds for us.

It looks like our management expense ratios (MER) are about 2% inside each of the funds. Should we shift to a self-directed ETF strategy to reduce fees? Our objectives are quite straightforward: growth for the next 30 years until we retire.”

My advice: People generally focus on what they are paying in fees if and when they accumulate a more sizeable amount of wealth. Do it before then. Our industry is set up to incentivize salespeople to pack as many high-fee mutual funds into accounts as they can. We need to see radical change from a regulatory standpoint.

A 2017 Morningstar report revealed that Canada received the lowest score regarding investment fees and expenses among 25 different countries. This trend has continued. The average MER is 2.23% in Canada versus 0.66% for the United States. I can’t think of any reason to invest in mutual funds with fees that high. You give up one third of your potential return over that 30-year period.

Investors need to understand that they are either paying a percentage fee upfront just to get into a mutual fund, or they are paying a percentage fee when they want to exit.

Australia is a great example of ‘doing it right’ – I recently interviewed the CIO of AMP, an investment firm with AU$85 billion under management. I was told how their government changed the pension system regulations to encourage the default investment product selection to be simple, low fee, and high performing products. This has flowed through to the entire pension system. An investment culture has emerged that is driven by a focus on the value you get for the fees that you pay.

5. Should I hold on to my losing stocks?

“I’m making a change in my asset mix and need to sell part of my equities’ allocation. I think it might make sense to sell the stocks that have had gains and keep the ones that are still in a losing position. Hopefully, the losers will come back soon.”

My advice: I am reminded of a great paragraph I read in Ashvin Chabbra’s book, The Aspirational Investor: “A well diversified portfolio will deliver market return with market risk, yet it does so on its own terms, unaware and uncaring of your needs and aspirations.” Holding onto losing stocks is the same concept. The thinking is no doubt that because they are down in value, they are bound to come back.

My advice is to try and remove emotion and take a long, hard look at what is in your portfolio today. If you wouldn’t go out and buy those companies today, get rid of them. There are plenty of other fish in the sea.