By Suzanne McGee
NEW YORK, Oct 21 (Reuters) – BlackRock rolled out another in a suite of exchange-traded funds tied to AI on Wednesday, even as the willingness of investors to wholeheartedly embrace the theme has hit speed bumps.
The global asset manager said that its iShares Future Robotics and Related Technologies ETF will invest in companies that use intelligent machines to streamline repetitive tasks in industries such as transportation and manufacturing, which it said represents the next frontier in AI technologies.
“Recent volatility is a reminder that AI is not a single trade and that investors need to be deliberate about where and how they take exposure,” said Jay Jacobs, US head of equity ETFs at BlackRock. That volatility does not change the firm’s conviction on the AI theme, he added.
“Expectations can shift quickly, adoption can develop unevenly and market risk remains concentrated in a relatively narrow group of companies,” Jacobs said. Moreover, AI has emerged as a driver of both returns and risk even in broad market portfolios.
Investors can choose from scores of ETFs that explicitly track the AI investment thesis, and dozens more technology-focused funds that have a heavy exposure via outsize stakes in stocks such as Micron or Nvidia.
At least six AI-linked ETFs have made their debut in the past month, many focusing on more narrow AI-related themes rather than offering broad AI products. For instance, Global X recently introduced the LLM ETF, which offers exposure to companies developing new large language models, while Defiance has launched the first ETF to target the bonds of AI infrastructure companies.
BlackRock said it believes robotics is key to the next wave of AI adoption in a variety of sectors.
(Reporting by Suzanne McGee in New YorkEditing by David Goodman)
Comments