Why don't singularitarians bet on the creation of AGI by buying stocks?

If your singularity stocks rapidly increase in value,

Why would they do that? anyone that believes the singularity is coming will want to sell them off, those that don't have little reason to buy. Stock markets can't price in their own non-existence.

Second, being a shareholder in the singularity could help you affect it.

Suppose google has almost reached AGI. $1000 of shares isn't going to buy meaningful influence on the details of a particular (probably secretive) project. I would be better off arranging to frequent the same social clubs as the programmers, and getting into discussions about AI, or mailing a copy of "Superintelligence" by Bostrum to all the team.

[-]John_Maxwell6y40

anyone that believes the singularity is coming will want to sell them off

My model of the average non-altruistic, non-rationalist investor is that they will want to hold onto their singularity stocks in order to increase their odds of being wealthy/powerful in the posthuman world. BTW, I gave 2 reasons in my post for why a rationalist investor would want to hold onto their stocks.

those that don't have little reason to buy

If a company creates some kind of transformative AI technology, we won't know in advance just how transformative the technology will be, or how quickly the potential of the transformation will be realized. Suppose a company comes up with an AI breakthrough that lets robots automate most manual labor, but it requires a person-year of effort to automate any given job. That company is going to be tremendously valuable.

Let's say an AI company comes up with something that's clearly a breakthrough. And little by little, it starts automating jobs, starting with the easy jobs. Let's suppose you're a singularity-skeptic investor. You don't think the singularity is going to happen any time soon. But this stock clearly seems like it could be super valuable and swallow a decent chunk of the world economy. So you buy.

Suppose google has almost reached AGI. $1000 of shares isn't going to buy meaningful influence on the details of a particular (probably secretive) project.

I think there's a lot depending on this "probably secretive" part. Let's say the project isn't secretive. Let's say it's like AlphaGo: something big and splashy, that gets even more attention than AlphaGo gets, and it seems to have widespread commercial applications. In that case, it will come up at shareholder meetings, and you can more easily be part of those conversations if you're a shareholder (and also exercise your vote). Note that the shareholder conversations matter a lot: Programmers report to their boss, who reports to the CEO, who reports to the board, who report to the shareholders.

I would be better off arranging to frequent the same social clubs as the programmers, and getting into discussions about AI, or mailing a copy of "Superintelligence" by Bostrum to all the team.

These sorts of things are already happening. And you have to be careful doing this stuff because you run the risk of coming across as a shill. However, the corporate governance route to influencing the singularity appears neglected, and doesn't run the risk of seeming like a shill: As an owner of the company that's developing this breakthrough tech, you have some small amount of legal authority over how it's deployed.

[-]Vaniver6y*130

buying stocks at random should perform roughly as well as the market as a whole

Except you have higher variance, which is normally something to avoid. Also note that average mutual fund performance is worse than index funds, even without taking fees into account; a similar story is likely true for individual investors.

But I do buy that being a reader of lesswrong dot com gives you inside information about particular sorts of things (of which covid19 was one), and I think betting big on such opportunities makes sense. I think it's not obvious that this gives you much ability to time the market or make good short-term bets, because it relies on understanding how the market reacts to things.

That is, suppose you have perfect accuracy on how bad covid19 will be; that doesn't actually tell you all that much about how much the market will drop when. So you might want to sell put options at a wide range of maturities instead of doing so for a single maturity date.

So similarly, if there's a company that has many irons in the fire and you think one particular bet will or won't pay off, you're still exposing yourself to all the other bets the company is making, which will increase the variance of your bet a lot. (I, for example, was long Netflix in 2011 on their DVD business and wanted to be short on their streaming business, since I thought the content owners would renegotiate for a larger share of the pie than the market expected they would, but couldn't easily figure out how the market was pricing the DVD business and the streaming business, and so wasn't sure what to do; as it happened, the market thought something like 90% of the value of Netflix was the streaming business, and so I should have been short the stock as a whole.)

[-]rossry6y100

Higher variance is worth avoiding (under standard assumptions), but I for one was surprised by how little additional variance one takes on by allocating, say, 10% of one's portfolio to a single arbitrary bet. In this comment I ballparked it at maybe an extra 0.5% variance.

That said, allocating one's entire portfolio this way basically requires a rejection of the standard risk-budget assumptions.

(Disclaimer: I'm a financial professional, but I'm not anyone's investment advisor, much less yours.)

[-]philip_b6y100

This post's arguments seemed correct to me, so I am gonna sell some S&P500 stocks and buy some google, facebook, tencent, etc. stocks instead. Thank you for writing this post.

[-]niplav1y20

I'm curious, how did this turn out?

[-]Dagon6y80

There are different "shapes" of AGI success. Some of them will benefit current leading companies which you can buy today. Some of them will create new companies that get most of the gains, costing you if you're long on the current leaders. Some of them (cf. definition of "singularity") change so many things about the world that your current paper/electronic "investments" just cease to have meaning.

[-]Alexei6y60

Yeah, I think this is spot on. I’ve had this idea for a few years and have been holding a few stocks of each company that I think has a chance at AGI.

[-]John_Maxwell6y50

I think I might have gotten the idea from you actually, I remember seeing you post about it.

[-]Jonas V5y50

Rather than just saying "just buy some AI companies" I'd be interested in the specific bets people are making, i.e., which stocks to buy, how to weight them, etc. Something like: Alphabet, Microsoft, Amazon, Facebook (or not because Good Ventures already might be overexposed?), Apple, IBM, Tencent, Alibaba, Baidu, perhaps plus some compute manufacturers. Thinking about the allocation seems relevant, too.

Relatedly, we could also think about how this relates to concerns about supporting these companies; perhaps divestment would be better than investing in these companies.

Obviously related, but not mentioned so far: The OP essentially describes mission hedging, see Hauke Hillebrandt: A generalized strategy of ‘mission hedging’: investing in 'evil' to do more good

[-]John_Maxwell5y*60

This reddit post has stats from a recent major machine learning conference. This graph is probably the most valuable. This post is on a different conference but points to a similar set of companies. Note that despite their low number of papers, Apple may still be a good investment; my understanding is that they prefer to keep their research secret.

I looked through the portfolios of a number of different AI-focused ETFs. From what I could tell, they are all more weighted towards random vaguely AI-adjacent tech companies like Spotify, Nvidia, and Shopify than Google--who knows why. This is the best ETF I could find approximating ML conference publications after a casual search (also accounting for the fact that FAANG do more research than just what is published):

https://etfdb.com/etf/IGM/#holdings

[-]Dagon6y50

If you believe in the singularity, why aren't you betting on it?

I gave some reasons that it's hard to bet on it, but I also want to point out that your premise is false. A whole lot of us _DO_ invest in various ways that differ from a total market index. I hold a number of stocks, and I'm using this opportunity to increase my stakes in many. I also have some non-stock investments which will outperform based on my model of the future (and the differential of that model from "common wisdom").

[-]John_Maxwell6y30

Fair enough. I don't see much investing discussion on LW, so I assumed most people were just buying index funds or something. I'm glad to hear you're betting your beliefs on a regular basis.

[-]Matthew Barnett6y40

Either we'll have a positive singularity, and material abundance ensues, or we'll have a negative singularity, and paperclips ensue. That's why my retirement portfolio is geared towards business-as-usual scenarios.

My objection to this argument is just, more generally, before the singularity there should be some period in which we have powerful AI, but the economy still looks somewhat familiar. The operationalization for this is Paul's slow takeoff, where economic growth rates should start to pick up a little before picking up by a lot.

[-]John_Maxwell4y30

I updated the post to note that if you want voting rights in Google, it seems you should buy $GOOGL not $GOOG. Sorry! Luckily they are about the same price, and you can easily dump your $GOOG for $GOOGL. In fact, it looks like $GOOGL is $6 cheaper than $GOOG right now? Perhaps because it is less liquid?

[-]ESRogs5y20

To investigate this question, let's examine Alphabet Inc's share price around the time AlphaGo defeated world Go champion Lee Sedol in March 2016.

They had already announced beating Fan Hui a few months earlier. So it was already known months ahead of time that they were at least near world class. Sure, it was an open question whether they would actually beat the very best, but it shouldn't have been shocking either way, people were betting on both sides. (I bet in favor.)

Furthermore, despite all the claims about Go falling to AIs a decade faster than anticipated, AlphaGo wasn't actually that big a jump above the trend-line for Go AI Elo. (See: https://www.milesbrundage.com/blog-posts/alphago-and-ai-progress )

So even if the win was a shock to many individuals, if the market as a whole had been paying attention, it shouldn't have been too much of an update.

All that said, I do think it's quite plausible that the market is undervaluing AI.

[-]philip_b6y20

Do you mind sharing your list of stocks which belong to companies with a nontrivial probability of creating AGI? Also, why Uber?

[-]John_Maxwell6y30

I haven't made a comprehensive list yet. You can find lists online though, e.g. here. I think Facebook is probably a good buy because the things Yann Lecun says about how AGI will work make a lot of sense to me.

Uber has an AI research division.

[-]Mati_Roy5y10

Part of it could be that the market is not informed about this, but maybe also part of it is that the market has a high-discount rate for very large upsides?

[-]Mati_Roy5y10

Generating a lot of value is not sufficient, it also needs to be able to capture that value through a monopoly. But AI is probably highly monopolistic in nature, so the conclusions still hold.

[-]Mati_Roy5y10

On November 30th, 2017, I told my investment company that I was 35% sure I would take out 35% of my investments to invest at Google and Baidu for that reason. I didn't end up doing that, putting more weight on something like the EMH (among a few other reasons). Although if I had really fully believed in the EMH, I would just have bought wide indexes. Anyway, now I've updated that under some circumstances, I should take the risk and go against the market with a part of my assets (I'm pretty surprised by the length it took for the market to drop). So I just checked my current portfolio. Since then my investment company has invested 20% of my assets in Alphabet, Microsoft, and Facebook; and also a bit of Amazon (Amazon hasn't been mentioned here; I assume they do less AI, but they do do some) (note: I can't share specifics of investment, but it's okay for me to share just that bit of information). So I already have a good amount in it. And they were evaluated as good by normal standards. I might buy some more Alphabet, and maybe Baidu(?), and maybe Uber(?), and maybe Tesla(?) when I get more money.

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Why don't singularitarians bet on the creation of AGI by buying stocks?

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The stock market's "ostrich view" of AGI

Even if the singularity is transformative, you want to be a shareholder

More 2020 stock sales