by Ian Cooper
If you’re looking for a hot investment theme, dig into artificial intelligence (AI).
According to Grand View Research, the global AI boom could grow from about $137 billion in 2022 to more than $1.81 trillion by 2030.
Fueling the story, OpenAI released ChatGPT, a free chatbot that’s become wildly popular. For one, according to Medium.com, “One of the primary reasons ChatGPT is disruptive is that it represents a significant advancement in the ability of AI systems to understand and generate human-like text.” Two, “it has the potential to revolutionize the way we interact with AI.”
Even the White House has taken notice.
In fact, the White House and the European Union agreed to work together to develop new AI tools. According to National Security Advisor Jake Sullivan:
“This collaborative effort will drive responsible advancements in AI to address major global challenges with a joint development model and integrated research to deliver benefits to our societies through five key areas of focus: Extreme Weather and Climate Forecasting, Emergency Response Management, Health and Medicine Improvements, Electric Grid Optimization, and Agriculture Optimization.”
While we can always invest in AI stocks, such as Microsoft, Nvidia, C3.AI, Splunk, and even Palantir, we can own more for less with an ETF.
Not only do ETFs allow you to diversify with dozens of top AI names, they allow you to do so at a lower cost. For example, the Global X Robotics & Artificial Intelligence ETF (BOTZ) offers exposure to 42 stocks. It traded at $25.70. If I were to buy 100 shares of the ETF, it would cost me $2,570. However, if I were to buy just one of the top BOTZ holdings – Nvidia, for example, it would cost me about $29,000 for just that one stock.
So, if you want great exposure to AI, take a look at these ETFs.
The Global X Robotics & Artificial Intelligence ETF (BOTZ)
With an expense ratio of 0.68%, this ETF invests in companies that could benefit from increased adoption and utilization of robotics and artificial intelligence (AI), including those involved with industrial robotics and automation, non-industrial robots, and autonomous vehicles. Some of its top holdings include Nvidia, SMC Corp., ABB Ltd., and Cognex Corp., for example.
The iShares Robotics and AI Multi Sector ETF (IRBO)
With an expense ratio of 0.47%, the ETF invests in companies benefiting from growth and innovation in robotics technologies and artificial intelligence. Some of its top holdings include IQIYI, Hell Group, Sumo Logic, Spotify, Meta Platforms, and Baidu.
First Trust NASDAQ Artificial Intelligence & Robotics ETF (ROBT)
With an expense ratio of 0.65%, the ETF seeks investment results that correspond generally to the price and yield (before the Fund’s fees and expenses) of an index called the Nasdaq CTA Artificial Intelligence and Robotics Index, as noted by First Trust. Some of its top holdings include C3.AI, AutoStore, Ambarella, Atos, NICE Ltd., and Dynatrace Inc.