The AI ETF Spreading Risk Across 86 Stocks Just Doubled the S&P 500

"AIQ is designed as a thematic growth holding for investors who believe AI adoption will be a multi-year structural trend but want diversification across that theme. Its return engine is straightforward: appreciation in the underlying businesses as AI drives revenue growth across software, semiconductors, cloud infrastructure, and digital services. There is no leverage and no options overlay, making it a clean, long-only expression of the AI thesis."

"The fund holds 86 stocks spanning the entire AI ecosystem. The top holdings are capped near 3-4% each, so no single name dominates. Alongside familiar names like Nvidia and Microsoft, the fund carries meaningful positions in international players like SK Hynix, Samsung, and Taiwan Semiconductor, giving it a global semiconductor footprint that a purely US-focused tech ETF would miss."

"AIQ's long-term track record supports its thematic premise. More recently, its 29.3% one-year return through early 2026 nearly doubled the roughly 13% posted by both SPDR S&P 500 ETF Trust and Invesco QQQ Trust over the same period, demonstrating that its broader value-chain exposure has translated into genuine outperformance rather than just benchmark-tracking with extra fees."

AIQ addresses investor concentration risk by spreading AI exposure across the entire value chain including software, semiconductors, cloud infrastructure, and digital services. The fund holds 86 stocks with top holdings capped at 3-4% each, incorporating global semiconductor players like SK Hynix, Samsung, and Taiwan Semiconductor alongside US names like Nvidia and Microsoft. Semiannual rebalancing maintains diversified weights. AIQ's one-year return of 29.3% significantly outperformed SPY and QQQ at roughly 13% each, validating its broader ecosystem approach. However, over 60% of assets concentrate in information technology and communication services, creating vulnerability to tech sector rotations or AI sentiment shifts. The 0.68% expense ratio exceeds broad index funds.

Read at 24/7 Wall St.