Group 1 - AI stocks are dominating passive indexes like the S&P 500 and Nasdaq, prompting investors to consider diversifying into Chinese AI stocks as a counterbalance to US tech skepticism [1] - The correlation between Chinese tech and US tech is low, which may provide diversification benefits if Chinese tech outperforms [2] - Different drivers, including domestic politics and technology advancements, influence the performance of Chinese and US tech stocks independently [3] Group 2 - Chinese tech firms are trading at significantly lower valuations compared to US tech, with some trading at half to a third of US valuations, despite releasing competitive AI products [4] - The Chinese stock market has a forward PE ratio of 14x, up from 11x a year ago, indicating that while valuations are lower than US counterparts, they are still high relative to historical levels [4] - The Invesco China Technology ETF has returned 38% this year, outperforming the Nasdaq 100's 19% gain, highlighting the bullish outlook on Chinese tech stocks [5]