Robotics - The New Frontier

[whatstheofficerproblem]

With there being a lot of 'hype' and material advancements in Robots & broader robotics, wondering if any of you have any good ideas to invest in this basket. I'm trying to find a pureplay on robotics in the domestic market and looks like they are almost non existent. Here are what I've come across.

 

Tesla (TSLA) - Not a pureplay, but with them expanding into 'Robots', the current extent of which I do not know, I feel very uncomfortable dipping my toes in the name for just one segment.

 

Intuitive Surgical (ISRG) - The only domestic pureplay on robotics I could find. They make great surgical robots, lots of advancements, terrific moat as most of today's doctors are practically trained on their equipment and there is a very high switching cost associated which given the maze the US healthcare system is, I don't think is possible. Solid company, earnings are great and will only get better. Expensive, but worth tracking.

 

Shanghai Baosight (900926) - International play on robotics. I am inclined to call this a pureplay on Robotics. They have an Information solutions business, Smart storage and best of all they manufacture industrial robots the advancements on which have led them to be confident in industrial level humanoid robots. They are literally expanding into Robot-as-a-Service (RaaS) model in real time. They also dabble in AI, the company is cheap on a relative basis but has a few structural problems. Might be worth buying, but not until I have a full picture, so closely monitoring this.

 

What are your thoughts on the sector and some of the names you might be interested for the robotics basket? 

[Saluki]

10 hours ago, whatstheofficerproblem said:

With there being a lot of 'hype' and material advancements in Robots & broader robotics, wondering if any of you have any good ideas to invest in this basket. I'm trying to find a pureplay on robotics in the domestic market and looks like they are almost non existent. Here are what I've come across.

 

Tesla (TSLA) - Not a pureplay, but with them expanding into 'Robots', the current extent of which I do not know, I feel very uncomfortable dipping my toes in the name for just one segment.

 

Intuitive Surgical (ISRG) - The only domestic pureplay on robotics I could find. They make great surgical robots, lots of advancements, terrific moat as most of today's doctors are practically trained on their equipment and there is a very high switching cost associated which given the maze the US healthcare system is, I don't think is possible. Solid company, earnings are great and will only get better. Expensive, but worth tracking.

 

Shanghai Baosight (900926) - International play on robotics. I am inclined to call this a pureplay on Robotics. They have an Information solutions business, Smart storage and best of all they manufacture industrial robots the advancements on which have led them to be confident in industrial level humanoid robots. They are literally expanding into Robot-as-a-Service (RaaS) model in real time. They also dabble in AI, the company is cheap on a relative basis but has a few structural problems. Might be worth buying, but not until I have a full picture, so closely monitoring this.

 

What are your thoughts on the sector and some of the names you might be interested for the robotics basket? 

Interesting idea for a theme or basket. I looked at intuitive surgical a long time ago but it looked really expensive. Haven't looked since, but good to put on the investigate list and revisit when I have some time. 

[Spekulatius]

Humanoid robots aren’t really that ideal for most tasks, so they are more a gimmick than a real product. Tesla’s robots are mostly remote controlled vaporware at this point.

 

Fanuc and Yaskawa are large Japanese robot suppliers and both publicly traded. In Europe there is ABB and in the US, Teradyne had a significant robot business.

 

I am not over enthusiast about robot business because the Chinese push hard and likely will be a deflationary force. Its a high priority from the CCP to become leader in robots because they are running out of labor and see this as a critical tech.

[dwy000]

While robotics will undoubtedly be a huge industry the winners will be the companies building custom robots for specific use.  The number of companies that have produced awesomely cool robots that have never gone anywhere is a long list.  Boston Dynamics being the poster child (and Tesla's humanoid will be.the same).  You never want to invest in a solution looking for a problem. You want the company that solves a massive problem for their customers using robots. And that usually means custom, problem-specific robotics. 

[whatstheofficerproblem]

I agree with Spek on the Humanoid robots aspect. I truly believe they are, for the time being a gimmick, nothing more or less. Which is why I'm interested in ISRG & Baosight, they are manufacturing robots that solve problems, be it in surgeries or supply chain. That said dwy, I'm just looking to create a basket that will be a small % of the portfolio, because why not? I think we will see positive developments on the robotics side given the amount of compute that is in demand right now, especially from companies that already make robots.

 

As for the rest, like another user on the forum stated (maybe Spek himself I think), we will see robotics become the new start-up fantasy land after the AI hype dies down.

Edited December 28, 2024 by whatstheofficerproblem

[Spekulatius]

Handjobs are difficult:

https://www.construction-physics.com/p/robot-dexterity-still-seems-hard

[whatstheofficerproblem]

1 hour ago, Spekulatius said:

Handjobs are difficult:

 

 

Spek, you better rephrase that

 

But good article. Something I have recently realized and agree with though is that the more mediocre/bad an investor is, the more he/she seems to think AI & Robotics will be revolutionary.

[RichardGibbons]

I think if one's been following AI at even a superficial level for the past five years, one has to be pretty simple not to recognize that AI will be revolutionary. In fact, it may already have met that criteria.

[Spekulatius]

2 hours ago, whatstheofficerproblem said:

 

Spek, you better rephrase that

 

But good article. Something I have recently realized and agree with though is that the more mediocre/bad an investor is, the more he/she seems to think AI & Robotics will be revolutionary.

Many things that are easy for human to do with their hands are very difficult. human hands are very complex and have thousands of

sensors. German language has a word for it “Fingerspitzengefühl”. It’s hard for relatively simple robot hands to get  dexterity while on the other hand robots can move with much higher precision and then repeat the same thing thousands of times.

Edited June 8, 2025 by Spekulatius

[DooDiligence]

1 hour ago, Spekulatius said:

Many things that are easy for human to do with their hands are very difficult. human hands are very complex and have thousands of

sensors. German language has a word for it “Fingerspitzengefühl”. It’s hard for relatively simple robot hands to get  dexterity while on the other hand robots can move with much higher precision and then repeat the same thing thousands of times.

 

Hits the spot a with a lot of stamina 

[Spekulatius]

 

1 hour ago, DooDiligence said:

 

Hits the spot a with a lot of stamina 

 

Edited June 9, 2025 by Spekulatius

[whatstheofficerproblem]

5 hours ago, RichardGibbons said:

I think if one's been following AI at even a superficial level for the past five years, one has to be pretty simple not to recognize that AI will be revolutionary. In fact, it may already have met that criteria.

 

Can AI replace grunt work? Of course it can. But anything that requires dealing with the unknown, like investing for example will be hard for AI to replicate. Like Spek rightly says above, Fingerspitzengefühl! The sensory aspect of a human cannot be replaced. Not yet atleast.

Edited June 9, 2025 by whatstheofficerproblem

[gfp]

37 minutes ago, whatstheofficerproblem said:

 

Can AI replace grunt work? Of course it can. But anything that requires dealing with the unknown, like investing for example will be hard for AI to replicate. Like Spek rightly says above, Fingerspitzengefühl! The sensory aspect of a human cannot be replaced. Not yet atleast.

 

I'll bet AI comes for investment managers a lot sooner than it comes for air conditioning repairmen.  If an index can already outperform 4/5ths of you suckers it isn't a strong starting position.

[DooDiligence]

3 hours ago, Spekulatius said:

 

 

 

That was hilarious!

I love the nurse 

[Milu]

9 hours ago, whatstheofficerproblem said:

 

Spek, you better rephrase that

 

But good article. Something I have recently realized and agree with though is that the more mediocre/bad an investor is, the more he/she seems to think AI & Robotics will be revolutionary.

Put me down in the mediocre/bad investor category so please, alongside Sundar Pichai, Zuckerberg, Sayya Nadella, Jensen Huang and any other Mag 7 CEO. 
 

Reminds me of Paul Krugman’s famous comment about the internet.

 

 

 

[Spekulatius]

8 hours ago, gfp said:

 

I'll bet AI comes for investment managers a lot sooner than it comes for air conditioning repairmen.  If an index can already outperform 4/5ths of you suckers it isn't a strong starting position.

On that I will agree. Finance is a massive opportunity to utilize AI. Another odd one is psychology as many Millenials have discovered that an AI chatbot does a decent job as a shrink with massive cost savings. I hadn’t thought of the latter but it sure seems happening.

 

Everything that needs to interact with the outside world like a robot or self driving cars is much more difficult to I implement.

[whatstheofficerproblem]

18 hours ago, gfp said:

I'll bet AI comes for investment managers a lot sooner than it comes for air conditioning repairmen.

 

It already has. Most institutional money on the public investment side is now in Quant funds (3x in the last 10 years). There was a financial times report on state of AUMs between Quant/Multi Manager/SM Discretionary over the years. This is what the said quant funds use. They use AI/ML but much of it is based on already existing data. These algos can predict movements in a said environment but they can't of course predict noise like Trump's tantrums and compounders.

 

For each good quant fund there are millions that print miserable numbers. We can say it's the same with all type of funds but LPs are salivating at the word quant and this has basically led to a VC like moment where you have LPs pulling money out of SM funds to throw them into the most random quant funds. Some funds are quantitative but not pure quant.

 

For example - RenTech, Systematica are examples of pure quant funds. Here we have only analysts who work the model and much of the trading & book mgmt is done by the model itself. Then we have quantitative/quantamental where the algos play a role albeit we have PMs managing the book. Every single fund today is to some extent 'quantitative'. AI will help decision making but cannot replace it imo. So if you're an experienced PM at one of the big platforms then your career is safe.

 

Analysts like myself are already at risk. Although, I would say that the grunt work i.e. excel monkey part of our jobs can be replaced and not the 'thinking' aspect of it because of 'decision laundering'. Let's say a PM decides to fire all analysts and run the shop himself, he gives AI his thoughts and transcripts to come up with an informed decision of where the stock is headed. The said thesis was wrong and performance went left tail, he will look like an idiot to his LPs if he said he used AI to make that decision. Instead, analysts like me can take the blame.

 

The above is the reason why most big platforms despite spending billions on building in-house quant platforms still have analysts subordinate PMs. Idea generation and blame can't easily be outsourced.

Edited June 9, 2025 by whatstheofficerproblem

[gfp]

Sounds like you picked the wrong industry!  Let me know when you want some air conditioner repairman tips

[Spekulatius]

17 hours ago, Milu said:

Put me down in the mediocre/bad investor category so please, alongside Sundar Pichai, Zuckerberg, Sayya Nadella, Jensen Huang and any other Mag 7 CEO. 
 

Reminds me of Paul Krugman’s famous comment about the internet.

 

 

 

I don’t  think anyone here claims that robotics never comes along. It has been in use since the 70’s for certain task in the automobile industry. I just don’t think it comes along especially with humanoid robots as fast as piept think and in particular , I doubt that Tesla is likely to succeed.

 

I think there will be many more robots for specific use cases and they are easier to train due to AI. I think anything mass produced will likely be commercialized by the Chinese (think Roomba). The top Chinese vacuum robots use LiDAR for navigation by the way, which Elon stated would be too expensive for cars.

[dwy000]

1 hour ago, whatstheofficerproblem said:

 

It already has. Most institutional money on the public investment side is now in Quant funds (3x in the last 10 years). There was a financial times report on state of AUMs between Quant/Multi Manager/SM Discretionary over the years. This is what the said quant funds use. They use AI/ML but much of it is based on already existing data. These algos can predict movements in a said environment but they can't of course predict noise like Trump's tantrums and compounders.

 

For each good quant fund there are millions that print miserable numbers. We can say it's the same with all type of funds but LPs are salivating at the word quant and this has basically led to a VC like moment where you have LPs pulling money out of SM funds to throw them into the most random quant funds. Some funds are quantitative but not pure quant.

 

For example - RenTech, Systematica are examples of pure quant funds. Here we have only analysts who work the model and much of the trading & book mgmt is done by the model itself. Then we have quantitative/quantamental where the algos play a role albeit we have PMs managing the book. Every single fund today is to some extent 'quantitative'. AI will help decision making but cannot replace it imo. So if you're an experienced PM at one of the big platforms then your career is safe.

 

Analysts like myself are already at risk. Although, I would say that the grunt work i.e. excel monkey part of our jobs can be replaced and not the 'thinking' aspect of it because of 'decision laundering'. Let's say a PM decides to fire all analysts and run the shop himself, he gives AI his thoughts and transcripts to come up with an informed decision of where the stock is headed. The said thesis was wrong and performance went left tail, he will look like an idiot to his LPs if he said he used AI to make that decision. Instead, analysts like me can take the blame.

 

The above is the reason why most big platforms despite spending billions on building in-house quant platforms still have analysts subordinate PMs. Idea generation and blame can't easily be outsourced.

Its an interesting take.  I agree a lot of the grunt work will be AI and probably already is.  Heck you can pull 10 year detailed models from any of a dozen brokers or tikr type services (even Yahoo Finance) where 10 years ago it would have been a lot of inputting from 10K's into excel.

 

But it ultimately becomes an index fund approach.  If 90% of institutional money is using AI there's no longer any differentiation and AI becomes the market.  Maybe you have some AI predicting what the other AI strategies will do and then front run them but thats a quickly ending cycle.

 

At the end of the day everyone can't beat the market because they ARE the market. 

[Milu]

12 hours ago, Spekulatius said:

I don’t  think anyone here claims that robotics never comes along. It has been in use since the 70’s for certain task in the automobile industry. I just don’t think it comes along especially with humanoid robots as fast as piept think and in particular , I doubt that Tesla is likely to succeed.

 

I think there will be many more robots for specific use cases and they are easier to train due to AI. I think anything mass produced will likely be commercialized by the Chinese (think Roomba). The top Chinese vacuum robots use LiDAR for navigation by the way, which Elon stated would be too expensive for cars.

Yes I agree robotics in general has been around for decades and has been quite successful. Humanoid robots is obviously the big buzzword right now and there seems to be a lot of big names forecasting great things (Google, Meta, Nvidia, Tesla) and many chinese companies too. Regarding timelines I also agree that it likely won't be as fast as people think. I suppose it depends on what timelines you are expecting. For me I am more thinking on a 10-20 year timeframe for this rather than anything that will move the needle in the next 5 years. My view is that it will take longer than people think but when it does reach scale it will be way bigger than anybody thinks. And I think Tesla has as much likelihood of being a leader as anybody else would. But a long way to go with many twists and turns. Place bets accordingly.

[LC]

https://archive.is/HO86m#selection-3428.0-3442.1

 

China pulling ahead in manufacturing robotics

[whatstheofficerproblem]

They always were. I think Chinese liquor/tobacco companies might be a good robotics bet. All the union workers who get laid off will fall back on substances given the big smoking/drinking culture there.

[Trophicdynamics]

@Milu this quote is hilarious. This is precisely why predicting the future is pointless. However, like a fool I still try to do it. 

 

 

[Milu]

Just now, Trophicdynamics said:

@Milu this quote is hilarious. This is precisely why predicting the future is pointless. However, like a fool I still try to do it. 

 

 

Krugman, what a genius!