5 Artificial Intelligence ETFs (Updated 2023)

Artificial Intelligence Investing

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The artificial intelligence sector is expected to be worth over US$407 billion by 2027. Here are five artificial intelligence ETFs for investors who want broad exposure to this developing industry.

It might be surprising, but the phrase "artificial intelligence" has been around for over half a century — since 1955, in fact. It was intended to describe a new computer science subdiscipline. But what exactly is artificial intelligence?

In simple terms, artificial intelligence, or AI, means "simulated intelligence in machines." In other words, machines with AI are capable of simulating thinking like people and mimicking their actions. The ideal characteristic of AI is the ability to rationalize.

Of course, that is a very broad definition of AI technology. There are actually at least 18 different applications of AI, which seems to prove that this market isn't going away anytime soon.

Case in point: Research conducted by Markets and Markets suggests the AI industry will be worth over US$407 billion by 2027, increasing at a compound annual growth rate of 36.2 percent between 2022 and 2027. With that much money going into the sector, there is certainly no shortage of ways for investors to add AI investments to their portfolios.

For those who are new to this segment of the technology arena and would prefer to gain exposure to the overall market rather than specific AI stocks, exchange-traded funds (ETFs) are a popular avenue. Here the Investing News Network looks at five AI-focused ETFs listed on ETFdb.com. All details were current as of April 26, 2023.

According to ETFdb.com, these AI ETFs are required to meet one of three criteria:

Focus on stocks developing new products, services or technological improvements in AI-related research
Have 25 percent portfolio exposure to companies that spend money on AI research and development expenses
Choose individual securities to be included in the fund based on their use of AI methods

1. Global X Robotics & Artificial Intelligence Thematic ETF (NASDAQ:BOTZ)

Company Profile

AUM: US$1.172 billion

The Global X Robotics & Artificial Intelligence Thematic ETF offers exposure to firms involved in the global automation and robotics industries. According to ETF.com, the Global X Robotics & Artificial Intelligence Thematic ETF was launched in September 2016 and has holdings in various markets, including technology, healthcare and energy. Eligible companies must earn a significant portion of their revenue from or have a stated business purpose in the fields of robotics or AI.

The ETF currently tracks 45 holdings, including Intuitive Surgical (NASDAQ:ISRG) and NVIDIA (NASDAQ:NVDA).

2. Robo Global Robotics and Automation Index ETF (ARCA:ROBO)

Company Profile

AUM: US$1.348 billion

The Robo Global Robotics and Automation Index ETF, launched in October 2013, was the first robotics and automation ETF to market. As its name suggests, it follows companies involved in those sectors. Robo Global currently tracks 80 companies, and its top two holdings are iRhythm (NASDAQ:IRTC) and Novanta (NASDAQ:NOVT).

3. ARK Autonomous Technology & Robotics ETF (ARCA:ARKQ)

Company Profile

AUM: US$874 million

The ARK Autonomous Technology & Robotics ETF was created in September 2014 and primarily focuses on advancements that enhance productivity and reduce costs in autonomous vehicles, robotics, 3D printing and energy storage technology.

The fund includes companies that may "benefit from the development of new products or services, technological improvements and advancements in scientific research related to, among other things, energy, automation and manufacturing, materials and transportation." This ETF tracks 34 holdings, with two of its biggest being Tesla (NASDAQ:TSLA) and Trimble (NASDAQ:TRMB).

4. iShares Robotics and Artificial Intelligence ETF (ARCA:IRBO)

Company Profile

AUM: US$306 million

The iShares Robotics and Artificial Intelligence ETF is relatively new compared to the others — the fund launched in June 2018. It tracks an index composed of 118 developed and emerging market companies that could benefit from long-term growth in robotics technology and AI. The fund has the lowest expense ratio of the five AI funds on this list at 0.47 percent.

Some of the ETF's top holdings include Meitu (OTC Pink:MEIUF,HKEX:1357) and iQIYI (NASDAQ:IQ).

5. First Trust NASDAQ Artificial Intelligence and Robotics ETF (NASDAQ:ROBT)

Company Profile

AUM: US$235 million

The last AI ETF on this list is the First Trust NASDAQ Artificial Intelligence and Robotics ETF, which like IRBO was launched in 2018. It follows a modified equal-weighted index of all-cap, global companies involved in AI or robotics.

ROBT currently tracks 108 companies, and its top two holdings are AeroEnvironment (NASDAQ:AVAV) and QinetiQ Group (LSE:QU).

This is an updated version of an article originally published by the Investing News Network in 2017.

Don't forget to follow us @INN_Technology for real-time news updates!

Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.

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Markets

TSX

19800.61

+20.64

TSXV

570.17

+0.08

DOW

34006.88

+43.04

S&P 500

4337.44

+17.38

NASD

13271.32

+59.51

ASX

7068.80

+3.60

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Natural Gas	2.63	-0.01

Commodities

Gold

1915.93

-8.80

Silver

23.13

-0.41

Copper

3.67

-0.02

Palladium

1713.17

0.00

Platinum

1087.26

0.00

Oil

89.88

-0.15

Heating Oil

3.20

-0.04

Natural Gas

2.63

-0.01

The Conversation (2)

William Bernstein

15 May, 2023

Also, just one other thought. What happens if this AI is so "good" it can be used in War? It gets into the "wrong" hands/minds. What happens then? AI against AI, what does that do to the world as we know it?

While AI is being presented as a great creation, and it is, it will lead to the destruction of life and livelihood as we know it. Lost jobs leading to poverty, leading to the destruction of life and livelihood. The only ones who will survive. in the short run, is those who have created it. They will be the only ones who will have money to spend. A minor, somewhat similar example is the tolls on the roads. The toll worker, due to technology (AI) lost their jobs. Sure, people are happy that they don't have long lines to wait on at a toll. At some point, all those on WallStreet won't be needed as AI will be the decision maker to make the investment directly. And so on, just a simpleton's point of view. I am sure there is a lot more. What do you think?

5 Artificial Intelligence ETFs (Updated 2023)

1. Global X Robotics & Artificial Intelligence Thematic ETF (NASDAQ:BOTZ)

2. Robo Global Robotics and Automation Index ETF (ARCA:ROBO)

3. ARK Autonomous Technology & Robotics ETF (ARCA:ARKQ)

4. iShares Robotics and Artificial Intelligence ETF (ARCA:IRBO)

5. First Trust NASDAQ Artificial Intelligence and Robotics ETF (NASDAQ:ROBT)

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