Nvidia Corp (NASDAQ: NVDA) shares have been among the best-performing stocks. In the last five years, the Nvidia share price has soared more than 1,200%, as the chart below shows.
Nvidia has been a massive beneficiary of the rise of AI, including generative AI.
For example, it was announced this week that OpenAI and Nvidia had signed a massive deal worth tens of billions of dollars, which could reach up to US$100 billion. According to CNBC, OpenAI plans to pay for Nvidia's graphic processing units (GPU) through lease arrangements. Nvidia will invest up to US$100 billion in OpenAI as the partnership deploys at least 10GW of Nvidia systems for OpenAI's AI infrastructure to run its next generation of models.
OpenAI is not the only one spending significantly on Nvidia's products, which is why the business is still seeing strong earnings growth.
I'm not expecting another 1,000% rise over the next five years, but the business could continue to deliver pleasing profit growth in the years ahead.
The most effective way to gain exposure to Nvidia shares would be to buy shares directly through a broker that allows international shares. But, for investors wanting to stick to investing via the ASX, there are a couple of effective options, including the two below.
Image source: Getty Images
Global X Fang+ ETF (ASX: FANG)
The first option is an exchange-traded fund (ETF) that provides investors exposure to ten of the biggest tech-related businesses listed in the US, of which Nvidia is one of them.
It regularly re-weights the portfolio weightings to 10% per business, which ensures no position becomes too large.
The current ten companies are: Crowdstrike, Apple, Nvidia, Microsoft, Alphabet, ServiceNow, Netflix, Meta Platforms, Broadcom and Amazon.com.
Most of these businesses are involved in AI to some degree, directly or indirectly, so it's a good way to invest in the themes that Nvidia is benefiting from.
Betashares Nasdaq 100 ETF (ASX: NDQ)
The Global X Fang+ ETF is a great ETF, though it appears to limit the potential weighting to Nvidia shares at around 10%.
The NDQ ETF could give greater exposure over time, if Nvidia becomes a larger part of the NASDAQ.
This fund is invested in 100 of the largest non-financial companies on the NASDAQ, which means it's also invested in names like Nvidia (with a 9.4% weighting), Microsoft (8.3%), Apple (8.2%), Alphabet (6%), Broadcom (5.8%), Amazon.com (5.1%) and Meta Platforms (3.6%).
But, it also has more diversification because it's invested in a lot more businesses than Global X Fang+ ETF
I think the Global X Fang+ ETF is better at providing direct exposure to Nvidia shares – the weighting is larger – but the NDQ ETF comes with stronger diversification as an overall investment.
