The Smartest Artificial Intelligence (AI) ETF to Buy With $500 Right Now
Tuesday, Dec 24, 2024 6:42 am ET
1min read Artificial Intelligence (AI) has emerged as a transformative force in the global economy, driving innovation and growth across various sectors. As AI continues to gain traction, investors are increasingly seeking exposure to this promising market through Exchange-Traded Funds (ETFs). With $500 to invest, here's the smartest AI ETF to consider right now.
The Global X Robotics & Artificial Intelligence ETF (BOTZ) stands out as an attractive option for investors looking to gain exposure to the AI sector. BOTZ offers a diversified portfolio of 43 stocks, providing exposure to both established and growth-oriented AI companies. Its top holdings include Nvidia (12.5%), ABB (10.2%), and Intuitive Surgical (7.7%), which are well-positioned to benefit from the growth of AI and robotics.
BOTZ's lower expense ratio of 0.68% compared to other AI ETFs like ROBO (0.95%) and IRBO (0.47%) helps maximize returns for investors. Additionally, BOTZ's YTD return of 25.3% (as of May 17, 2024) demonstrates its potential for growth, making it an appealing choice for investors seeking exposure to the AI sector.
When evaluating AI ETFs, it's essential to consider their sector allocations and holdings. BOTZ's diversified portfolio across industrial robotics, automation, non-industrial robots, and autonomous vehicles provides exposure to multiple AI sub-sectors. This diversification helps mitigate risk and capture the growth potential of the AI industry.
Investment strategies and methodologies also play a crucial role in the performance and volatility of AI ETFs. Passive AI ETFs like BOTZ track an index of AI-related companies, aiming to replicate its performance. Active AI ETFs, such as IRBO, use a fund manager's expertise to select stocks, potentially generating higher returns but with increased volatility. Passive AI ETFs typically have lower expense ratios, making them more suitable for long-term investors seeking broad exposure to the AI sector with lower costs.
The fund management team and their track record can significantly influence the performance and reliability of AI ETFs. Global X Management Company, the fund manager of BOTZ, has a strong track record in thematic investing, with a focus on emerging technologies. BOTZ's 5-year CAGR of 14.5% reflects the fund's success in capturing the growth of AI and robotics.
In conclusion, the Global X Robotics & Artificial Intelligence ETF (BOTZ) is the smartest AI ETF to buy with $500 right now. Its diversified portfolio, lower expense ratio, and strong performance make it an attractive option for investors seeking exposure to the AI sector. As AI continues to revolutionize industries and drive growth, BOTZ offers a compelling way to participate in this exciting market.
Disclaimer: the above is a summary showing certain market information. AInvest is not responsible for any data errors, omissions or other information that may be displayed incorrectly as the data is derived from a third party source. Communications displaying market prices, data and other information available in this post are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any security. Please do your own research when investing. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit, or protect against loss in a down market.
