On 2023/02/17, I said that I would follow Warren Buffett to avoid the geopolitical risk of Taiwan. The endgame, or the "ultimate resolution" between Taiwan and China is very uncertain that will likely involve economic disruptions, so I would avoid buying more Taiwan Semiconductor Manufacturing Company (TSM). That made me missing the boat as shown in the chart below that, the price more than doubled since then (from $90 to ~$200):
While the company is solid, I want to revisit the geopolitical risk of Taiwan to see whether I should jump back into TSM. After reading a lot of opinions from various experts, I got the following conclusion with the help of Gemini:
Most experts believe that the status quo is likely to persist for the next decade or more. This is based on the current balance of power, the lack of political will on either side for a drastic change, and the potential costs and risks associated with any attempt to alter the status quo.
Does it mean I will likely resume my purchase of TSM? Yes, but it will be at most 10% of my portfolio, and likely less.
What do I think about the current valuation of TSM? I think it's fairly valued, so it's acceptable to buy more at the current price given the company has a very strong moat. More analysis soon!
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