This year has undoubtedly seen artificial intelligence (AI) at the forefront of 2025’s investing themes, but there are many ways to slice and dice AI exposure to capture upside. Investors may not be fully leveraging the spillover effect that the AI theme has on the energy sector. In an “All Angles” podcast called “Powering AI: Why Energy Is Back in Focus (and What’s Driving It),” MFS portfolio manager and energy sector team lead Jude Jason discussed these opportunities.
As AI adoption continues across industries, the technology will require substantial electricity to run. This will place heavy demands on the electrical power grid, creating a plethora of energy-sector opportunities. As Jason noted, the demand-supply dynamics of the energy sector support its investment case.
“They’ve (energy and technology) come together in a way that they’re coupled because they need each other symbiotically… It’s been interesting also to see how the stocks have correlated,” Jason said. He added that as “the economy becomes more digital, the power demand is outstripping supply, which is what’s leading to talks of a bottleneck.”
Given the expansive growth opportunities existing in energy as AI proliferates and disrupts various industries, how can investors achieve exposure to capture this upside? An ideal way is via active management.
MFS has a suite of active exchange-traded funds (ETFs) that can capture such opportunities, including the current developments surrounding AI. The focus of each fund may be different, but the principles driving their strategies are shared amongst the firm.
“We have a range of strategies and portfolios across the firm,” Jason said. “But I think what we would all say and have in common is a shared philosophy around relative quality and underappreciated dynamics that could benefit these businesses and construct portfolios of relatively strong operators that could navigate tricky environments over time, depending on how different things develop.”
Active Opportunities With MFS ETFs
Active management offers benefits that passive/index funds don’t, including market flexibility. Those active managers can tilt the fund’s exposure towards sectors that benefit from market trends, such as energy and AI. For example, the Active Value ETF (MFSV) has a 6.32% allocation to the energy sector as of October 31. Another example is the Active Growth ETF (MSFG), which allocates 2.38% (as of October 31) to energy company GE Vernova.
Given that uncertainty is looming over current market conditions like interest rates, tariffs, and geopolitical tensions, it’s almost imperative that investors allocate to actively managed funds. To that point, the MFS portfolio management team has an average industry experience of 26 years. As such, MFSV and MSFG draw on this industry knowledge and expertise when selecting a fund’s holdings.
Click here to listen to the full podcast.
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