According to BlackRock, the world’s largest asset manager, artificial intelligence will continue to dominate the markets in 2026. The announcement comes amid growing concerns about the market’s AI dominance veering into bubble territory.
Even though the firm believes that AI will continue to dominate, it also acknowledged that investors may be in for a turbulent ride as speculative activity and leverage continue to build.
According to Reuters, Helen Jewell, BlackRock’s CIO of fundamental equities EMEA, said on Thursday that AI-linked investment returns are likely to trend higher.
However, there may also be some periods of volatility due to sector valuations or the broader outlook.
“Do I expect an upward trend of AI growth returns? Yes, these are incredible capital spends being driven by companies with incredible amounts of cash,” Jewell told Reuters on the sidelines of a conference in London.
“Do I think that there is likely to be a rocky ride as we go there. Also yes,”
The growing concerns regarding AI-related volatility become even more relevant considering how hedge funds are deploying near-record levels of leverage to trade equities and bet on debt-backed strategies.
These activities may make hedge funds and the broader market more vulnerable to losses in case of a correction.
For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds. The hedge fund data is as of Q3 2025.
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10. Astera Labs, Inc. (NASDAQ:ALAB)
Number of Hedge Fund Holders: 57
Astera Labs, Inc. (NASDAQ:ALAB) is one of the 10 AI Stocks Analysts are Tracking Closely. On December 3, Stifel analyst Tore Svanberg maintained a Buy rating on the stock with a $200 price target. The rating affirmation follows ALAB’s stock plunge post AWS/NVDA announcement to integrate NVLink Fusion into its Trainium 4 XPU deployments.
The announcement sparked investor concerns regarding ALAB’s position in the NVLink ecosystem, particularly the switch opportunity risk in NVLink deployments. However, the firm addressed these concerns stating that AWS/NVDA tie-up concerns are overblown.
“We believe these fears are misplaced and would be acquirers of ALAB stock on weakness. ALAB’s support for the NVLink ecosystem and more active role in hyperscaler custom designs mean the company should have a continued solid content opportunity in NVLink Fusion designs across hyperscaler deployments.”
Astera Labs, Inc. (NASDAQ:ALAB) is engaged in the design, manufacture, and selling of semiconductor-based connectivity solutions for cloud and AI infrastructure.
9. CrowdStrike Holdings, Inc. (NASDAQ:CRWD)
Number of Hedge Fund Holders: 66
CrowdStrike Holdings, Inc. (NASDAQ:CRWD) is one of the 10 AI Stocks Analysts are Tracking Closely. On December 3, BMO Capital analyst Keith Bachman raised the firm’s price target on the stock to $555 from $500 and kept an “Outperform” rating on the shares. The price target raise follows CrowdStrike’s “solid” third quarter fiscal year 2026 results.
Revenue for the quarter rose 22% year over year to $1.23 billion, slightly exceeding the 21% growth reported in the second quarter of fiscal 2026. ARR grew 23% year over year to $4.92 billion as of Oct. 31, 2025, up 20% from the previous quarter.
Looking ahead, the company guided fiscal fourth-quarter revenue between $1.29 billion and $1.30 billion; while it expects total revenue of about $4.80 billion to $4.81 billion for the full fiscal year ending Jan. 31, 2026. This represents an estimated 20% to 22% growth year over year.
BMO Capital highlighted that the cybersecurity firm delivered upside on every metric for the quarter and guide. Meanwhile, the company’s “broad and leading portfolio,” including SIEM (Security Information and Event Management), Identity, Cloud, and Charlotte AI capabilities, will help the company sustain durable growth.
Despite the company being the best positioned security company in the firm’s coverage universe, the firm noted that the company’s current valuation positions it “lower in our pecking order of Outperform-rated names.”
CrowdStrike Holdings, Inc. (NASDAQ:CRWD) is a leader in AI-driven endpoint and cloud workload protection.
