Investors have been eager to capitalize on the potential of artificial intelligence (AI) as its transformative effects become increasingly apparent. While major tech companies like Apple, Microsoft, and Amazon have experienced significant growth due to their early adoption of AI, there are other ways for investors to tap into this emerging theme.
Passive Specialists
For investors who want a straightforward approach, the Legal & General Artificial Intelligence ETF offers a way to track the top AI companies. This ETF follows the ROBO Global Artificial Intelligence Index, which includes 65 companies ranked based on their AI revenues, investments, and market and technology leadership. The fund has a diverse range of sector allocations, with technology comprising the majority at 72.2%, but also exposure to consumer discretionary and healthcare. The Legal & General Artificial Intelligence ETF has delivered a strong return of 31.7% this year, outperforming the average IA Global fund.
Active Specialists
Investors looking for a more hands-on approach may consider the Sanlam Global Artificial Intelligence fund, which is managed by Chris Ford and Tim Day. This actively managed fund invests in 43 companies deemed to be the biggest long-term beneficiaries of AI. With a focus on Nvidia, Alphabet, Microsoft, and Tesla, the fund has delivered impressive returns, rising 24.7% in the 2023 rally and achieving a substantial 177.1% since its launch in 2017.
General Tech
For those seeking broader exposure to the technology sector, the Polar Capital Global Technology fund is an excellent choice. Managed by Ben Rogoff since 2006, the $5.2 billion portfolio has significant exposure to companies with disruptive AI potential. While the fund covers growth themes beyond AI, it has outperformed the IA Technology & Technology Innovation sector average by 139.9 percentage points over the past decade.
In conclusion, investing in AI can be approached through passive funds that track top AI companies, active funds that handpick AI beneficiaries, or broader technology funds that capture various growth themes. Each approach offers unique opportunities for investors to capitalize on the long-term growth potential of AI.
Source: Funds-Europe.com
FAQ
What is the Legal & General Artificial Intelligence ETF?
The Legal & General Artificial Intelligence ETF is an exchange-traded fund that tracks the performance of the ROBO Global Artificial Intelligence Index. It includes 65 companies with strong AI revenues, investments, and market and technology leadership.
What is the Sanlam Global Artificial Intelligence fund?
The Sanlam Global Artificial Intelligence fund is an actively managed fund that invests in 43 companies expected to be the biggest beneficiaries of AI. The fund is managed by Chris Ford and Tim Day and has shown impressive returns since its launch in 2017.
What is the Polar Capital Global Technology fund?
The Polar Capital Global Technology fund is a broad technology fund managed by Ben Rogoff. While it focuses on companies with potential for AI disruption, it also covers various growth themes within the technology sector.
Which fund has performed the best?
The Legal & General Artificial Intelligence ETF has delivered the highest return so far this year, outperforming other funds with a rise of 31.7%. However, the Sanlam Global Artificial Intelligence fund has achieved substantial returns since its launch in 2017, up by 177.1%.
Are there any cheaper options for investing in AI?
Passive funds like the Legal & General Artificial Intelligence ETF tend to have lower management fees compared to actively managed funds. However, with an ongoing charge of 0.49%, it is still considered relatively expensive by some investors.