Oct 28 (Reuters) – Exchange-traded funds focused on artificial intelligence are proliferating as asset managers offer investors new ways to capitalize on the market’s enthusiasm for AI, even as it remains unclear which companies will be the long-term winners will emerge from the market. latest technological revolution.
More than a third of the two dozen ETFs that have artificial intelligence or AI in their names launched in 2024 alone, according to data from Morningstar.
In the past week, three more have joined their ranks, including a cloud computing ETF that has been rebranded and revamped to focus specifically on AI. The AI ETF group now has assets worth $4.5 billion, putting it closer to the $5.5 billion nuclear-themed ETF universe and well above the cannabis sector, with $1.37 billion in assets .
“I’m not surprised that their ranks are multiplying,” said Daniel Sotiroff, a senior analyst at Morningstar. “This is a fast-growing, fast-evolving industry, and it’s easy to hope that you can make a lot of money in a short period of time.”
The first of the company’s AI products, the $630 million iShares Future AI & Tech ETF, which launched in 2018, is currently trading just below its 52-week high recorded on October 14.
While the original AI product is index-linked, the two new funds are actively managed and designed to capture emerging opportunities within AI, said Jay Jacobs, head of active and thematic ETFs at BlackRock.
“The AI market is going to change dramatically,” says Kim. “What you think today will not be what it will be tomorrow, next year or a few years from now.”
ARMS MATCH
Amplify ETFs earlier this month rebranded an existing cloud-computing ETF with a new focus on the emerging technology, calling it the Amplify Bloomberg AI Value Chain ETF.
“Now we’re trying to get exposure to cloud with a specific AI tilt,” says Nathan Miller, vice president of product development at Amplify.
The long-term goal, he added, is to be ready to turn a profit if and when all that capital spending on AI shows up in the profits, and to be at the forefront of identifying new opportunities.
“Like any other ETF company, we try to offer investors something differentiated,” Miller said.
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Reporting by Suzanne McGee in Providence, Rhode Island; Editing by Lewis Krauskopf and Matthew Lewis
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