The artificial intelligence (AI) industry has seen a surge in exchange-traded funds (ETFs) in the past year as companies from various sectors look to incorporate AI into their business models and improve efficiency.
According to Jon Maier, chief investment officer of Global X ETFs, the initial wave of AI adoption was led by the “Magnificent Seven” Big Tech companies that have access to a lot of data. However, Maier noted that every company in the S&P 500 is now talking about AI and how to effectively use the technology.
Global X ETFs manages the Global X Artificial Intelligence and Technology ETF, which focuses on larger AI names in the space and has seen a 39% increase year to date.
Another ETF that can give investors exposure to AI beyond traditional tech is the Global X Robotics and Artificial Intelligence ETF, according to Maier.
VettaFi’s Todd Rosenbluth also highlighted the impact of AI on broader sectors, noting that health care and e-commerce companies are benefiting from AI adoption. VettaFi runs the index behind the ROBO Global Artificial Intelligence ETF, which focuses on companies developing the technology and infrastructure powering AI.
Rosenbluth believes that the AI trade is in its early stages and expects to see more ETF investors looking at thematic-oriented ETFs in the coming years.
Dave Mazza, chief strategy officer of Roundhill Investments, discussed their Roundhill Generative AI and Technology ETF, which launched earlier this year. The ETF focuses on large-cap tech, pure-play AI, and semiconductor companies and has experienced an over 8% increase year to date.
Overall, the surge in AI-focused ETFs reflects the growing interest and investment in AI technology beyond the traditional tech sector. As more companies across various industries embrace AI, ETFs offer investors an opportunity to gain exposure to this emerging and rapidly evolving market.