Artificial Intelligence (AI) is reshaping industries and economies at an unprecedented rate, driving remarkable growth and transformation worldwide. With the so-called ‘Fourth Industrial Revolution’ well underway owing to massive investments in AI and its prospects of driving economic growth, AI is truly taking over the world by storm.
Amid this backdrop, investors can consider fundamentally stable AI ETFs, Global X Robotics & Artificial Intelligence ETF (BOTZ), Robo Global Robotics and Automation Index ETF (ROBO), and Amplify AI Powered Equity ETF (AIEQ), as promising opportunities for AI growth.
The forthcoming AI and its integration into various industries has aptly been named the Fourth Industrial Revolution. The transformative power of AI, along with the Internet of Things (IoT) and robotics, are steadily changing the way conventional industries, economies, and societies function, bringing in a new age of innovation.
With its branches spreading into a wide array of industries such as cloud computing, biotechnology, education, sales, marketing, cyber security, and so many more, investment in AI infrastructure has also never seen better days. According to a report by IDC, infrastructure spending in AI is expected to surpass $100 billion by 2028.
With such an impactful role in various corners of the economy and driven by higher investments, AI is set to contribute up to $15.70 trillion to the global economy by 2030.
So, let us dive deep into the fundamentals of three AI ETFs, starting with #3.
ETF #3: Global X Robotics & Artificial Intelligence ETF (BOTZ)
Launched and managed by Global X Management Company LLC, BOTZ invests in stocks of companies operating across the development of robotics and/or artificial intelligence. The fund tracks the Indxx Global Robotics & Artificial Intelligence Thematic Index by using a full replication technique.
With $2.61 billion in assets under management (AUM), BOTZ’s top holdings include NVIDIA Corporation (NVDA) with a 13.54% weighting, followed by Intuitive Surgical, Inc. (ISRG) at 10.48% weighting, ABB Ltd. (ABBNY) at 9.06% and Keyence Corporation at 6.67%.
The ETF has a total of 47 holdings, with its top 10 assets comprising 63.32% of its AUM. Its net inflows came in at $39.79 million over the past month. In addition, BOTZ pays an annual dividend of $0.05, which translates to a 0.14% yield at the current price level.
BOTZ has gained 6.9% over the past six months and 15.1% over the past year to close the last trading session at $32.92. The fund’s NAV was $32.79 as of December 26, 2024.
BOTZ’s POWR Ratings reflect its strong prospects. The fund has an overall rating of A, translating to a Strong Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
BOTZ has an A grade for Buy & Hold and Trade. It is ranked #16 out of 119 ETFs in the A-rated Technology Equities ETFs group.
To access all of BOTZ’s POWR Ratings, click here.
ETF #2: Robo Global Robotics and Automation Index ETF (ROBO)
ROBO, managed by Exchange Traded Concepts, LLC, focuses on companies in information technology, software, and automation services. It employs a full replication technique to align with the ROBO Global Robotics and Automation Index, offering targeted exposure to the rapidly evolving robotics and automation industries.
With an AUM of $1.07 billion, ROBO’s top holdings include the U.S. Dollar with a 2.80% weighting, followed by Harmonic Drive Systems Inc. at 2.38%, HIWIN Technologies Corp. at 1.85% and Teradyne, Inc. (TER) at 1.77%.
The ETF has a total of 79 holdings, with its top 10 assets comprising 18.90% of its AUM. Its net inflows came in at $58.94 thousand over the past five days. ROBO pays an annual dividend of $0.03, which translates to a 0.05% yield at the current price level.
The fund has surged 5.8% over the past six months to close the last trading session at $57.69. It has a NAV of $57.16 as of December 24, 2024.
ROBO’s POWR Ratings reflect its robust prospects. The fund has an overall rating of A, which translates to a Strong Buy in our proprietary rating system.
It has an A grade for Buy & Hold and Trade. ROBO is ranked #24 out of 119 ETFs in the Technology Equities ETFs group.
To check all the POWR Ratings for ROBO, click here.
ETF #1: Amplify AI Powered Equity ETF (AIEQ)
AIEQ, launched and managed by Amplify Investments LLC alongside Tidal Investments LLC, focuses on U.S. public equity markets. The fund aims to deliver returns aligned with the performance of the AI Powered Equity Index, leveraging advanced AI strategies to guide its investment approach.
With $112.70 million in AUM, AIEQ’s top holdings are NVDA with a 6.64% weighting, followed by Microsoft Corporation (MSFT) with a 6.36% weighting, KLA Corporation (KLAC) with a 3.54% weighting and Texas Instruments Incorporated (TXN) at 3.49% weighting.
AIEQ has a total of 148 holdings, with its top 10 assets comprising 36.62% of its AUM. In addition, AIEQ pays an annual dividend of $0.26, which translates to a 0.63% yield at the current price level. Moreover, the fund’s dividend payouts have grown at a CAGR of 85.4% over the past three years.
The ETF has gained 13.2% over the past six months and 12.7% over the past year to close the last trading session at $40.64. The fund’s NAV was $40.60 as of December 26, 2024.
AIEQ’s POWR Ratings reflect its solid fundamentals. The fund has an overall rating of A, equating to a Strong Buy in our proprietary rating system.
AIEQ has an A grade for Buy & Hold and Trade. Within the A-rated All Cap Equities ETFs group, it is ranked #46 out of 169 ETFs.
Click here to see all AIEQ POWR Ratings.
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BOTZ shares were unchanged in premarket trading Friday. Year-to-date, BOTZ has gained 15.67%, versus a 28.14% rise in the benchmark S&P 500 index during the same period.
About the Author: Aanchal Sugandh
Aanchal’s passion for financial markets drives her work as an investment analyst and journalist. She earned her bachelor’s degree in finance and is pursuing the CFA program.
She is proficient at assessing the long-term prospects of stocks with her fundamental analysis skills. Her goal is to help investors build portfolios with sustainable returns. More…