The Financial Post reports in its Thursday, June 25, edition that bouts of volatility in the artificial-intelligence trade are threatening to snowball into a rout as positioning and crowding levels flash red. A Bloomberg dispatch to the Post reports that the long-term AI outlook remains positive, but the short-term situation is unclear. High leverage in ETFs, options hedging and volatility in semiconductor prices are creating a challenging environment. Everyone is effectively getting longer AI by the day, according to Goldman Sachs Group partner Bobby Molavi. He said: "The co-correlation of strategies is a point to watch. Feels great on the way up, but can be extremely dangerous on the unwind." Doubts about future returns on big tech investments have resurfaced, fueled by larger stock and debt issuances. Meanwhile, high long-term earnings expectations for chipmakers are raising questions about how realistic they are. One of the biggest worries is the rapid proliferation of leveraged ETFS. Accounting for about $200-billion (U.S.) in assets, every 1 per cent move in the underlying index triggers roughly $9-billion (U.S.) of rebalancing in the same direction due to a significant short-gamma effect.