Two prominent Chinese hedge funds have warned that the rapid rise in artificial intelligence stocks has created a speculative bubble that could be approaching a sharp correction.
Wealspring Asset, led by founder Yang Dong, who is known for correctly calling the peak of China’s stock market in 2007, told investors that AI shares are forming a “super bubble” and cautioned that its “collapse point may not be far away”, according to Bloomberg.
Shanghai Banxia Investment Management also voiced concerns, highlighting the explosive revenue growth reported by AI company Anthropic and arguing that the conditions for an AI market correction are already emerging.
Despite the warnings, China’s technology sector continues to attract significant investor interest. Technology companies have raised around $3.1 billion through stock market listings so far this year, more than five times the amount raised during the same period in 2025, according to LSEG data.
Nearly 50 technology businesses, including semiconductor manufacturers and robotics firms, have applied to list on the Shanghai and Shenzhen stock exchanges, with planned fundraising exceeding 126 billion yuan (£14 billion).
Among the largest proposed listings is memory chip manufacturer ChangXin Memory Technologies (CXMT), which is preparing a 29.5 billion yuan IPO in Shanghai. If completed, it would be the largest flotation in China this year and push total technology fundraising to its highest level in three years.
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