To diversify your investments to to get portfolio exposure to AI companies without selecting specific AI stocks, consider investing in an AI-focused exchange-traded fund (ETF). This allows you to tap into numerous top AI companies without the hassle of individually analyzing each stock.
Artificial Intelligence has been gaining massive popularity across the world. Its technology has been utilized in a variety of workspaces including electronics, automation, robotics, and more. This has truly brought machine learning to a different height.
This has led to a large number of people gaining interest in AI-focused exchange-traded funds also known as (ETFs). Allowing investors to gain exposure to some of the best AI companies without identifying the individual AI stocks.
In this article, we will mention the 4 Best AI ETFs in 2023 to invest in. So, let’s begin.
Best AI ETFs to Buy in 2023
|AI ETF||ASSETS UNDER MANAGEMENT||EXPENSE RATIO|
|Global X Robotics & Artificial Intelligence ETF (NASDAQ:BOTZ)||$2.12 billion||0.69%|
|ROBO Global Robotics and Automation Index ETF (NYSEMKT:ROBO)||$1.38 billion||0.95%|
|iShares Robotics and Artificial Intelligence ETF (NYSEMKT:IRBO)||$338.1 million||0.47%|
|First Trust Nasdaq Artificial Intelligence ETF (NASDAQ:ROBT)||$294 million||0.65%|
|TrueMark Technology, AI & Deep Learning ETF (LRNZ)||$36.2 million||0.68%|
|Global X Artificial Intelligence & Technology ETF (AIQ)||$499.7 million||0.68%|
|Direxion Daily Robotics, Artificial Intelligence, & Automation Index Bull 2X Shares (UBOT)||$40.43 million||1.35%|
Here are list of the best artificial intelligence ETFs to buy in 2023:
The Global X Robotics & Artificial Intelligence ETF (BOTZ) was started in 2016. The main goal is to look around and invest in those companies which can be beneficial from increased adoption of robotics and Artificial Intelligence.
This includes investment in those organizations or businesses that work under automation, autonomous vehicles, industrial robotics, and non-industrial robots. For now, BOTZ holds around 44 stocks.
Here are the top four holdings of BOTZ which currently holds around 40% of the fund’s assets are mentioned below:
Keyence Corporation (KYCCF 0.78%): This is a Japanese electronics company that manufactures world-class automation sensors, scanners, digital microscopes, laser makers, and more.
Fanuc (FANUY -0.38%): Fanuc is a Japanese group of companies that manufactures automation products. It includes products such as robots, lasers, CNC systems, and electric injection molding machines.
Intuitive Surgical (ISRG -0.63%): Intuitive Surgical is an American corporation that manufactures and refines robotic systems.
NVIDIA (NVDA 0.37%): NVIDIA is an American corporation that manufactures and develops software-defined autonomous vehicles. It is also considered the world leader in AI Computing.
The ROBO Global Robotics and Automation Index ETF (Nasdaq: ROBO) helps track the performance of the ROBO Global Robotics and Automation Index.
It involves those companies or organizations that manufacture, distribute, design or utilize robotics and automation technologies. ROBO was first launched back in 2013 and is currently considered one of the oldest and most well-known AI ETFs.
The ETF even contains more than $2 billion in assets under its management. The top 10 holding showcase around 17.63% of its total assets.
However, none of its single positions makes up more than 2% of the fund. Some of the Top holdings of ROBO are Azenta Inc. (AZTA) and Zebra Technologies Corp. (ZBRA), Intuitive Surgical Inc. (ISRG).
IShares Robotics and Artificial Intelligence ETF (NYSE: IRBO) was established in 2018. It holds a strong position in communication and tech companies such as popular streaming platform Netflix Inc. (NFLX), FuboTV Inc (FUBO), Matterport Inc. (MTTR), and Lattice Semiconductor Corp. (LSCC). The technology sector contains 61.75% of its holdings.
On July 13th IRBO closed at $35.15 per share which is considered to be up by 35.63% year to date. It is currently well-diverse and contains 118 stock holdings.
Top investments of the fund that holds around 6% of IRBO’s assets are Spotify (NASDAQ: SPOT), Meitu (1357. HK), Sumo Logic (NASDAQ: SUMO), iQIYI (IQ -1.79%) and Hello Group (MOMO 2.37%).
First Trust Nasdaq Artificial Intelligence and Robotics ETF (Nasdaq: ROBT) was first started in 2018. It is considered to be one of the purest AI ETFs in the industry. ROBT usually invests around 90% of net assets in those corporations and companies.
Mainly those that are involved in artificial intelligence and robotics in industrial, technology, and other sectors. ROBT is up by 30.86% year to date and closed on July 13 at $47.34.
It currently owns around 108 stocks. The two largest fund holdings of First Trust Nasdaq Artificial Intelligence and Robotics ETF are Ambarella Inc. (AMBA) and Palo Alto Networks Inc. (PANW). It currently owns around 108 stocks.
TrueMark Technology AI & Deep Learning ETF (LRNZ) is an actively managed ETF. This fund is a concentrated portfolio of global stocks.
It is involved in the manufacturing, development, and utilization of machine learning, Artificial Intelligence, and other deep learning technologies.
LRNZ is considered as the third-best-performing AI ETF in 2023, with about 34.9% return. LRNZ concentrates on providing thematic exposure.
To those organizations and companies that are involved in advanced levels of artificial intelligence application.
It usually holds around 20-30 positions representing those corporations and companies that possess advanced and innovative Artificial Intelligence and Deep learning solutions. That is capable of representing a distinct competitive advantage in a particular industry.
Global X Artificial Intelligence and Technology ETF (AIQ) is a fund that heavily weighs in technology. It also holds strong consumer cyclical and communication services stocks.
In 2023, Global X Artificial Intelligence and Technology ETF (AIQ) was named as the fourth best-performing AI ETF. On July 13 it had a closing of around $29.19 along with a return of 42.49% year to date.
AIQ also holds a basket of stocks across industries globally. Some of the top positions of The Global X Artificial Intelligence & Technology ETF (AIQ) are as follows:
- Meta Platforms Inc. (META)
- Tesla Inc. (TSLA)
- Microsoft Corp. (MSFT)
- Nvidia Corp. (NVDA)
- Apple Inc. (AAPL)
In 2023, Direxion Daily Robotics, Artificial Intelligence, & Automation Index Bull 2X Shares (UBOT) was considered as one of the best-performing AI ETFs. The funds of UBOT currently track a similar index as BOTZ.
But it has a difference of 2x leveraged funds which makes it volatile. The UBOT goes through a rebalance on a daily basis which indicates that longer-term returns can deviate significantly.
Some of the top index holdings are Nvidia, Intuitive Surgical, ABB Ltd, Keyence, Fanuc Corporation, Dynatrace, Yaskawa Electric, and more.
How to find AI ETFs
The best way to find Artificial Intelligence Etfs is by examining the top AI stocks held by the funds. Apart from this, you can also find AI ETFs by looking at the fund’s expense ratio, past performance, and dividend yield.
What is the best ETF for AI?
The best ETFs for AI are Global X Robotics and Artificial Intelligence ETF (BOTZ), Global X Artificial Intelligence and Technology ETF (AIQ), The ROBO Global Robotics and Automation Index ETF, and more.
What is the largest ETF for AI?
Global X Robotics & Artificial Intelligence ETF (BOTZ) is the largest ETF for AI with $2.52B in assets.
Does Vanguard have an AI ETF?
Yes, Global X Robotics & Artificial Intelligence ETF is the AI ETF of Vanguard offered by prospectus only.
AI-Powered ETFs Lagging in 2023
The AI-powered ETFs are lagging behind the S&P 500 and the Nasdaq composite. This lagging has taken place in terms of year-to-date returns at a time when AI-based stocks drove the market gains.
Best AI ETFs: YTD Performance 2023
The best AI ETSs YTD Performance of 2023 are as follows:
- Direxion Daily Robotics, Artificial Intelligence, & Automation Index Bull 2X Shares (UBOT) with a YTD return of +75.75%
- The Global X Robotics & Artificial Intelligence ETF (BOTZ) with a YTD return of +35.38%
- TrueMark Technology AI & Deep Learning ETF (LRNZ) with a YTD return of
- Global X Artificial Intelligence and Technology ETF (AIQ) with a YTD return of
- The ROBO Global Artificial Intelligence ETF (THNQ) with a YTD return of