Institutional investors are no longer bystanders in the artificial intelligence boom; they are helping to drive it. Their vast pools of capital make them natural financiers of AI’s most expensive assets, from hyper-scale data centres to training systems. But these investments carry distinct risks: high upfront costs, rapid obsolescence and growing geopolitical strain across supply chains.
Those risks raise a broader question. How durable is the current AI investment cycle? AI’s boom resembles past waves of industrial investment: vast, transformative, but prone to overreach. Institutional capital is not only funding the build-out of AI infrastructure; it may also magnify the next technology downturn.
This report examines how institutional investors are navigating that tension. Drawing on a global survey of 300 institutional investors, it explores what is driving allocations, how investors would respond to a sharp correction and how portfolios are positioned to capture AI’s longer-term gains.