From Cable Cars to Code: An Investment Perspective

I recently returned from a trip to San Francisco, and one image has stayed with me. While riding in an Uber through the city, I watched San Francisco’s iconic cable cars. They were first used there in the late 1800s and have continued to climb the same steep hills, just as they have for generations. On the same streets, fully autonomous Waymo vehicles make their way through traffic with no driver behind the wheel (I was thinking that ordering an Uber was considered the new trendy technology). The contrast was stark: 19th-century engineering and 21st-century technology operating side by side in real-time; yet it was all relatively seamless.

It was a reminder of how quickly the world is changing. Throughout my career, I have experienced significant change. So far, I have leaned into it, but how will I, and others in my generation, feel when the new changes involve increasingly intelligent computers in our daily lives? Can we handle these rapid innovations?

A Personal Perspective on the Pace of Innovation

I was in San Francisco to drop off my son, who was starting a co-op position at a robotics company. Watching him step into an industry focused on automation, coding, and intelligent systems had me reflecting on the economy and investment markets. It’s great having an industry insider in the family to help me better understand technology.

Entire careers, and entire industries, are now being shaped by technologies that were in their infancy just a few years ago. However, this will also mean “creative destruction,” with job losses and industries being significantly disrupted by technological shifts. The Inter-American Development Bank’s index of occupational exposure indicates that 980 million jobs worldwide are at a high risk of disruption this coming year. That’s not negligible.

Michael Nuschke, my former business partner and “retirement futurist”, let me know that humanoid robots will be shipped to North America later this year. A 2024 Citi report predicted that there could be 1.3 billion AI robots by 2035 and four billion by 2050. This will likely hit home for many of us when we see humanoid robots “in the wild.” Perhaps a humanoid robot, like Star Wars’ C-3P0, will take your blood at your next hospital visit? I’m not sure I’m ready to embrace that change but considering the potential impact of robotic services on hospital wait times, I might have to.

For investors, this raises an important question: how do we participate in innovation without chasing the latest headline?

Investment Conference Insights

This past November, I attended an investment conference in Nashville. Across multiple sessions, there was a common theme of AI and technology:

Artificial intelligence is no longer conceptual; it is generative. It is being used across various industries, including transportation, logistics, healthcare, finance, and manufacturing.
We can expect to see accelerated earnings and productivity gains resulting from the adoption of AI. The market theme in 2025 was tariffs; the 2026 theme could be productivity gains due to AI.
The current focus is on enablers; those providing the infrastructure and tools necessary for AI development. Semiconductors are the critical enabler. Advanced chips, used for AI training, inference, sensors, and robotics, are now as crucial as energy infrastructure once was.
There is more to it than the big headline names like Google and Nvidia. Beyond the most visible technology companies, opportunities exist across supply chains, equipment manufacturers, software platforms, and specialized service providers.
We have already experienced significant volatility in this sector. Innovation cycles tend to move fast (sometimes in both directions), reinforcing the importance of diversification and disciplined portfolio construction.
We are seeing significant AI capital expenditure (capex). In 2025, AI capital expenditure (capex) was approximately $0.5 trillion. It is anticipated that AI capital expenditure (capex) will reach $1.3T by 2030. The spending on AI is not limited to the US; AI capital expenditures extend to Europe.
AI and productivity themes have a multi-year runway. It appears that we are in the early stages of a 5- to 10-year AI runway.

Over a break between sessions, I spoke with a portfolio manager from Australia, who emphasized that innovation and sustainability are increasingly connected. AI-driven efficiency, electrification, grid modernization, and energy-storage technologies are not only technological advancements, but they are also central to productivity growth and the global energy transition.

Innovation, Energy, and ESG Alignment

From an Environmental, Social, and Governance (ESG) perspective, the merger of technology and energy is significant.

Autonomous systems, AI optimization, and advanced semiconductors are enabling:

More efficient energy use across transportation and industry
Smarter power grids and better integration of renewables
Reduced waste, improved logistics, and lower emissions

At the same time, the energy required to power data centers, AI training models, and electrification reinforces the need for thoughtful exposure to companies and assets supporting cleaner, more robust energy systems.

For us, ESG investing is not just about excluding companies from your portfolio. It is about allocation of investment capital toward businesses that are improving efficiency, managing risk responsibly, and positioning themselves for long-term relevance in a changing economic and environmental landscape.

What This Means for Portfolios

As advisors, our role is not to predict which single technology will “win,” but to ensure portfolios are positioned to participate in long-term structural change while managing risk appropriately.

This reflects our core investment philosophies:

Diversification over concentration, particularly in fast-moving innovation cycles, where things can change quickly.
Time-horizon discipline, clearly separating money needed in the short term (funds for vacations or new car purchase) from funds intended for long-term growth, allowing each to be invested appropriately.
Long-term discipline, resisting short-term noise while reassessing fundamentals as conditions evolve
Responsible investing integration, recognizing that ESG factors increasingly influence risk, return, and long-term outcomes

These technological shifts are actively reshaping markets and outcomes. They present meaningful growth opportunities, but also real risks if ignored or misunderstood. Our role is to thoughtfully account for both, positioning portfolios and long-term plans to participate in innovation while managing the potential downsides of rapid change.

Looking Ahead

Our friendly and chatty Uber driver took us on an unexpected detour down the winding curves of Lombard Street, sharing stories along the way about the city’s famous parrots. Will technology rob us of these personal experiences, or will they, too, be coded in the future?

One thing is clear: change is happening at an increasingly rapid pace.

Our responsibility is to ensure your portfolio evolves in line with these changes, grounded in long-term fundamentals, informed by innovation, aligned with sustainability, and tailored to your personal objectives.

If you would like to discuss how these themes are reflected in your portfolio, please do not hesitate to reach out.

Yours truly,
Richard Nickerson CFP®, RIAC
Senior Financial Planning Advisor
CI Assante Wealth Management Ltd.