Artificial intelligence (AI) is booming and investors are increasingly betting on exchange-traded funds (ETFs) focused on this promising sector. Given the exponential growth prospects of AI, specialized ETFs have a bright future.
AI ETFs Attract Investors
Artificial intelligence (AI) has become increasingly popular in recent years. Between ease of use, technical feasibility and the ever-increasing range of applications, this sector is attracting ever greater interest from the general public and investors. This enthusiasm for AI has direct repercussions on the promising ETF market in the sector.
Renowned Bloomberg analyst Eric Balchunas predicts that AI and robotics will dominate the exchange-traded fund (ETF) market over the next decade. Recent advances in the field, such as ChatGPT software capable of conversing, are indeed attracting investors towards these future themes.
“ The unbridled imagination of investors, combined with the explosion in demand for AI services, creates ideal conditions for specialized ETFs to take off quickly » analysis the expert.
Aware of the lucrative potential of artificial intelligence, the behemoths of Silicon Valley are following suit. Apple is reportedly working on launching its own AI products to ride the wave. Google has just unveiled an improved version of its Gemini software entirely powered by AI algorithms. Microsoft continues to aggressively expand its portfolio in the field of conversational agents.
Almost all publicly traded technology giants are now looking to profit from AI, in one form or another. For the moment, these products generate still modest revenues for these multinationals, but the global AI market could literally explode as early as 2024 according to analysts. Investors are already anticipating this meteoric growth by positioning themselves on ETFs dedicated to this strategic sector.
Nvidia’s performance, an AI barometer
Nvidia’s recent financial results show how artificial intelligence can boost revenues for tech giants. In the last fiscal quarter, the Californian company raked in a colossal turnover of $22.1 billion, with $5.16 in adjusted net income per share.
Astronomical sums largely due to sales of AI products developed by Nvidia, including the famous graphics chips (GPU) used to train machine learning algorithms.
Over the entire 2022 financial year, Nvidia generated no less than $27 billion in revenue. These dizzying figures are further proof of the enormous financial potential of artificial intelligence for digital giants. They also explain why investors were already flocking massively to ETFs in the sector.
With an average annual growth rate of +37.3% expected by 2030, AI is clearly establishing itself as the new technological Eldorado of the coming years. Its rise should continue to boost the profits of ETFs dedicated to this strategic sector, and potentially offer very juicy returns to savvy investors.
There is no doubt that this promising technology will shape the world of tomorrow. And as such, ETFs specializing in AI probably have a bright future ahead of them.
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