The artificial intelligence investing boom is taking shape in epic fashion this year. Thanks to exchange traded funds, including the ARK Autonomous Technology & Robotics ETF (ARKQ), investors don’t have to engage in burdensome stock picking to access this theme.
Up 15.36% year-to-date, the actively managed ARKQ is clearly benefiting from the renewed, potentially long-lasting emphasis on artificial intelligence investing. The ETF is all the more relevant at a time when some market observers are comparing the generative AI boom to an “iPhone moment” of sorts.
For its part, Goldman Sachs likened generative AI today to early innings of the cloud computing boom. The investment bank made that comparison in a recent report, noting generative AI has a potential total addressable market of $350 billion and could drive trillions of dollars in global economic efficiencies and output in the years ahead.
“AI is touted to be the next big shift in technology after the evolution of the internet, mobile and the cloud. We believe Generative AI can streamline business workflows, automate routine tasks and give rise to a new generation of business applications,” according to the bank.
Making ARKQ’s status as an active fund all the more pertinent against the current generative artificial intelligence backdrop is the point that some companies are already establishing leadership positions. That includes Google parent Alphabet (NASDAQ: GOOG), which is behind the Bard chatbot. That stock accounts for 2.11% of ARKQ’s, and is among Goldman’s favored AI equity ideas.
“Generative AI tools have far-reaching implications across industries, from enterprise software to healthcare, financial services and more,” added Goldman.
Translation: Like some other disruptive technologies, AI can intersect with other innovative themes and industries. That’s already happening. Take the case of Adobe (NASDAQ: ADBE) and Nvidia (NASDAQ: NVDA), the latter of which accounts for 3.42% of the ARKQ roster. Those two companies recently a partnership to develop next generation AI modeling tools, “some of which will be jointly developed through Adobe’s Creative Cloud product portfolio and through Nvidia’s Picasso cloud service,” reported Pia Singh for CNBC.
Another AI play highlighted Goldman Sachs is Intuit (NASDAQ: INTU). While the provider of tax prep and business software and the parent of Credit Karma isn’t a member of the ARKQ roster, the stock account for nearly 4% of the ARK Fintech Innovation ETF (ARKF), confirming AI has myriad potential applications in the fintech universe, too.
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The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.