3 ASX ETFs to buy for exposure to the booming international AI sector

These are three of the most exciting funds on the ASX.

| More on:
A white and black robot in the form of a human being stands in front of a green graphic holding a laptop and discussing robotics and automation ASX shares

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

AI shares have boomed in the last 12 months as investors have identified which businesses are going to benefit from selling the new technology to the world. There are a few ASX-listed exchange-traded funds (ETFs) that can give us exposure to that world.

An ETF gives us exposure to a whole range of businesses in just one investment, which is handy considering we can't say for certain which AI-related business will be the big winner of the future, though NVIDIA Corp (NASDAQ: NVDA) is certainly doing its best to claim the AI title.

Having said that, let's look at three ASX ETFs that could be good candidates to own if AI exposure is the goal of an investor.

Global X Fang+ ETF (ASX: FANG)

This ETF aims to just invest in the largest businesses in the US. They are involved in a number of investment themes including technological advancements, changing demographics and consumer preferences.

The big technology businesses are among the most influential globally in the AI space. The FANG ETF gives good exposure – around 10% of the portfolio – to names like Nvidia, Microsoft, Tesla and Alphabet. It only owns 10 names though, which isn't a lot of diversification.

It has an annual management fee of just 0.35%, which is cheaper than other ASX ETFs that give sizeable exposure to large tech names. For example, the Betashares Nasdaq 100 ETF (ASX: NDQ) has an annual management fee of 0.48%.

BetaShares Global Robotics and Artificial Intelligence ETF (ASX: RBTZ)

The idea of this fund is that it invests in global companies involved in areas like industrial robotics and automation, non-industrial robots, artificial intelligence and unmanned vehicles and drones.

It is currently invested in 42 names, so there's more diversification with this option than the FANG ETF.

The RBTZ ETF has an annual management fee of 0.57%, which isn't bad.

There are four industries within the portfolio with a weighting of at least 10%, including industrial machinery and supplies (24.3%), semiconductors (21.3%), healthcare equipment (12%) and electronic equipment and instruments (11.2%).

In terms of the biggest individual positions, there are five names with a weighting of more than 7.5%: Nvidia (8.9%), Abb (8%), Intuitive Surgical (7.9%), Keyence (7.9%) and SMC (7.7%).

Global X Robo Global Robotics & Automation ETF (ASX: ROBO)

This is another fund involved in robotics, automation and so on.

Global X explains that the average cost of an industrial robot declined from US$46,000 in 2010 to just US$27,000 in 2017. It's forecast to fall below US$11,000 by 2025 as technology improves and scales. The fund provider suggests robotics and automation have "wide-reaching applications, extending far beyond industrial activity."

The ROBO ETF comes with an annual management cost of 0.69%, so it's the most expensive of the three ASX ETFs in this article.

The ROBO ETF currently has 77 holdings in the portfolio, with the biggest position accounting for less than 2% of the portfolio and most of the weightings being between 1% and 2%.

At the time of writing, the biggest three positions are Kardex, Intuitive Surgical and Autostore.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, BetaShares Nasdaq 100 ETF, Intuitive Surgical, Microsoft, Nvidia, and Tesla. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has recommended Alphabet and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on ETFs

Man holding out Australian dollar notes, symbolising dividends.

Here's the current ASX dividend yield on the Vanguard Australian Shares ETF (VAS)

How much passive income can one expect from this popular index fund?

Read more »

A businesswoman looks out a window at a green, environmental project.

Want to invest in shares that help the world go green? Try this ASX ETF

These companies are helping the world with global decarbonisation.

Read more »

Two men sit side by side on a couch with video game controls in their hands and expressive looks on their faces as they react to the action in front of them in a home setting.

2 ASX growth ETFs I think could double in value over the next year

ETFs covering high growth sectors have the potential to deliver significant capital gains

Read more »

Woman in a hammock relaxing, symbolising passive income.

3 reasons the iShares S&P 500 ETF (IVV) is a great long-term investment

The US share market is a compelling place to invest.

Read more »

a man with a wide, eager smile on his face holds up three fingers.
Index investing

3 Vanguard ASX ETFs that could create a complete investment portfolio

Here's how I think any ASX investor can build a complete portfolio with just three ETFs.

Read more »

A couple sitting in their living room and checking their finances.

The pros and cons of buying the BetaShares Australia 200 ETF (A200)

These are what I consider to be the main positives and negatives of the cheapest ASX share ETF in Australia.

Read more »

A man points at a paper as he holds an alarm clock.

3 highly rated ASX ETFs to buy and hold

Buy and hold investors might want to check out these top funds.

Read more »

The letters ETF with a man pointing at it.

Invest $10,000 into these ASX ETFs next week

These ETFs provide investors with access to some high-quality companies.

Read more »