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3 Simple Ways to Play the AI, Robotics Revolution

Published 04/11/2024, 08:31 AM
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  • Today, we'll explore three ETFs offering exposure to robotics and artificial intelligence, simplifying investment in these sectors.
  • Creating a diversified portfolio of shares or opting for funds and ETFs can be an intriguing option for long-term investors.
  • These ETFs provide a cost-effective and straightforward approach to capitalize on the potential of robotics and AI.
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  • Robotics and Artificial intelligence (AI) are not just the future but also the present, and they are poised to revolutionize our world and daily lives, both personally and professionally.

    Experts in these fields suggest that we are still in the early stages. It's akin to being able to invest in Internet-related stocks at the dawn of the Internet age. That's why allocating some of our capital to invest in robotics and AI for the medium to long term could be a rewarding idea.

    There are two primary ways to do this:

    1. Create an investment portfolio by purchasing shares of companies in the robotics and AI sectors. However, this requires time, effort, and expertise to research, analyze, and select suitable companies. Additionally, monitoring and management of the portfolio are necessary, along with associated expenses like broker commissions for buying and selling.
    2. Invest in an ETF (Exchange-Traded Fund), which streamlines the process. An ETF handles everything, including research, analysis, buying, and selling shares, all for a lower commission than creating a portfolio of individual stocks. This is the option we'll explore today.

    You might think you need to invest in two separate ETFs, one for robotics and one for AI. However, it's simpler than that. You can invest in an ETF that covers both sectors together.

    Here are three such ETFs that combine both robotics and AI sectors:

    1. Global X Robotics & Artificial Intelligence ETF

    Global X Robotics & Artificial Intelligence ETF (NASDAQ:BOTZ) replicates the Global Robotics & Artificial Intelligence Thematic index, which is made up of companies from around the world that stand to benefit from the rise of robotics and AI.

    BOTZ ETF Price Chart

    The ETF has a U.S. and a European version.

    Total annual fees are 0.50% Dividends from the ETF are distributed to investors every six months.

    The ETF was launched on November 16, 2021 and is domiciled in Ireland.

    Its 1-year yield is 26.29%. It invests in 45 companies, with the following being the most heavily weighted:

    • NVIDIA (NASDAQ:NVDA) 21.18%.
    • Intuitive Surgical (NASDAQ:ISRG) 10.65
    • ABB (ST:ABB) 8.57%
    • Keyence (OTC:KYCCF)
    • UiPath (NYSE:PATH) 4.33%
    • Dynatrace (NYSE:DT)
    • SMC 3.91%
    • Daifuku 3.36%
    • YASKAWA Electric 3.27%

    By country, its investments are distributed as follows:

    • United States 54.31% Japan
    • Japan 25.72% Switzerland 10.62
    • Switzerland 10.62% Norway
    • Norway 2.27% United Kingdom 1.58
    • United Kingdom 1.58% Finland 1.46
    • Finland 1.46% Others
    • Others 4.04% Others 4.04% Others 4.04% Others 4.04% Others 4.04% Others

    2. iShares U.S. Tech Breakthrough Multisector ETF

    iShares U.S. Tech Breakthrough Multisector ETF (NYSE:TECB) was created in 2020. Dividends are paid quarterly.

    iShares U.S. Tech Breakthrough Multisector

    Commissions are 0.40%. The yield since its creation is 10.80%. The ETF replicates the NYSE FactSet index (NYSE:FDS) U.S. Tech Breakthrough, which is Formed by U.S.-listed companies engaged in the research and development of cutting-edge products and services in the areas of robotics and artificial intelligence.

    Its main positions are:

    • NVIDIA 6.51%.
    • Meta (NASDAQ:META) 5.62%
    • Amazon (NASDAQ:AMZN) 4.36%
    • Merck 4.28%
    • Salesforce (NYSE:CRM) 4.02%
    • Alphabet (NASDAQ:GOOGL) 4%
    • Microsoft (NASDAQ:MSFT) 3.93%
    • Netflix (NASDAQ:NFLX) 3.61%
    • Advanced Micro Devices (NASDAQ:AMD)
    • Oracle (NYSE:ORCL) 3.38%

    3. Invesco AI and Next Gen Software ETF

    Invesco AI and Next Gen Software ETF (NYSE:IGPT) was launched in June 2005 and has fees of 0.60%. Its return since its inception is 15.26%.

    Invesco AI and Next Gen Software

    The ETF replicates the Stoxx World AC NexGen index and invests at least 90% of its assets in the stocks that make up the index.

    Its main positions are:

    • Alphabet 9.47%.
    • Meta Platforms 8.59%
    • NVIDIA 7.92%
    • Adobe (NASDAQ:ADBE) 7.08%
    • Advanced Micro Devices 6.73%
    • Intuitive Surgical 4.59%
    • Qualcomm (NASDAQ:QCOM) 4.58%
    • Micron (NASDAQ:MU)
    • Intel (NASDAQ:INTC) 3.94%
    • Keyence 2.98%

    ***

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    Disclaimer: The author does not own any of these shares. This content, which is prepared for purely educational purposes, cannot be considered as investment advice.

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