4 ETFs that invest in AI stocks
One of the best ways to enter a specific sector or industry is through exchange traded funds. ETFs are similar to mutual funds in that they trade like stocks but are baskets of stocks. So it’s inherently more diverse than a single stock.
The hottest part of the market this year and probably in the near future is artificial intelligence. AI is not an industry in itself. It’s more of an application or investment theme that runs across all industries. Therefore, finding individual stocks driven by AI is not an easy task.
It’s much easier to invest in an AI-themed ETF that includes a basket of stocks powered by this emerging technology. The benefit of doing so is that you know you’re investing in a broad range of AI-focused stocks and not trying to pick one or two winners.
Here are four top-performing AI-focused ETFs to consider. Each ETF occupies a different part of the space, as evidenced by its holdings.
1. ROBO Global Artificial Intelligence ETF
that much ROBO Global Artificial Intelligence ETF (NYMARKET:THNQ) tracks the proprietary ROBO Global AI Index. This ETF consists of 63 stocks from companies around the world that are developing the technologies and infrastructure that enable AI or applying AI in a variety of ways, including business processes, e-commerce, and healthcare. Stocks included in the index are identified by ROBO Global’s research team and strategic advisors, with greater weighting given to the most pure-play AI stocks.
The ETF’s top five holdings are Alteryx (NYSE:AYX), Crowdstrike Holdings (NASDAQ:CRWD), Cloudflare (NYSE:NET), Splunk (NASDAQ:SPLK), and Advanced Micro Devices (NASDAQ:AMD).
As of December 15, the ETF was up 56% since the beginning of the year and 44% over the past month. Since it launched in May 2020, it doesn’t have a long track record and only has about $119 million in assets under management. Additionally, the expense ratio is 0.68%.
2. Global
that much Global X Artificial Intelligence & Technology ETF (NASDAQ:AIQ) is one of two AI-focused ETFs offered by Global X. Indxx tracks artificial intelligence and big data indices. This includes companies that have the potential to benefit from further developing and utilizing AI technology in their products. And service. It also consists of companies that provide hardware that facilitates the use of AI for data analytics. This ETF is slightly broader than the Robo ETF, with 87 stocks.
The five largest positions are Intel (NASDAQ:INTC), IBM (NYSE:IBM), ServiceNow (NYSE:NOW), Qualcomm (NASDAQ:QCOM), and Amazon (NASDAQ:AMZN), making this ETF an attractive candidate for broader net gains. You can see that. .
This ETF is up 52% YTD and about 43% over the past year. Since it was launched in 2018, it has recorded returns for five consecutive years, with an average annual return of about 17.6%. It has an asset ratio of 0.68%, or about $845 million.
3. Global
Global X has another AI-focused ETF. Global X Robotics and Artificial Intelligence ETF (NASDAQ:BOTZ). It is a more focused fund that invests in companies that utilize robotics and AI, including industrial robots and automation, non-industrial robots, and self-driving cars.
The ETF’s top holdings include NVIDIA (NASDAQ:NVDA) and Intuitive Surgical (NASDAQ:ISRG), as well as some global leaders in the sector such as ABB Group (Switzerland), Keyence (Japan), and Fanuc (Japan). It tracks the Indxx Global Robotics and Artificial Intelligence Subject Index and consists of 44 holdings.
The $2.3 billion ETF is up 36% YTD and 28.3% over the past year. Since its founding in 2016, the five-year average annual rate of return is 9.8% and the expense ratio is 0.69%.
The final choice is iShares Robotics and Artificial Intelligence Multi-Sector ETF (NYMARKET:IRBO). The fund tracks the NYSE FactSet Global Robotics and Artificial Intelligence Index. This includes both developed and emerging market companies that can benefit and grow from innovations in robotics technology and artificial intelligence. This is the broadest of the four ETFs, holding about 112 stocks.
The five largest companies in the ETF are FuboTV (NYSE:FUBO), Faraday Technology (Taiwan), Alchip Technologies (Taiwan), MicroStrategy (NASDAQ:MSTR), and Via Technologies (Taiwan).
This $569 million ETF is up 35.7% YTD and 27.3% over the past year. Since it was founded in June 2018, its five-year average annual return is 11.1%. The cost ratio is 0.47%.
These ETFs are not the only four options focused on AI, but they are among the best performers on a YTD and one-year basis. As you can see, they are quite different in that they track different sectors of the vast and growing part of the economy called AI.
