Artificial intelligence (AI) could create some enormous winners over the next decade.
But rather than trying to predict which individual companies will come out on top, I'd prefer to invest in a selection of businesses that could benefit from its growth.
The good news is that exchange traded funds (ETFs) make this possible. But which ones could be worth considering as buys? Listed below are three to choose between for easy AI exposure:
Image source: Getty Images
Global X Semiconductor ETF (ASX: SEMI)
The first ETF I'd buy is the Global X Semiconductor ETF, which invests in companies involved in developing and manufacturing computer chips.
This could be an attractive way to invest in AI because the technology requires enormous computing power, and that means strong demand for increasingly advanced semiconductors.
The fund holds around 30 companies, including Nvidia (NASDAQ: NVDA), whose powerful processors are widely used to train and run AI models.
It also owns South Korean memory chip manufacturer SK Hynix (NASDAQ: SKHY) and ASML Holding (NASDAQ: ASML), which supplies essential equipment used to manufacture advanced chips.
What I like is that these businesses can benefit from rising AI infrastructure spending, regardless of which software companies ultimately become the biggest winners.
With investment in AI computing continuing to grow, this ETF could potentially deliver attractive long-term returns.
Global X Artificial Intelligence ETF (ASX: GXAI)
Another ASX ETF I would consider is the Global X Artificial Intelligence ETF, which provides exposure to companies involved in developing and applying AI technology.
Unlike the semiconductor ETF, this fund invests across the AI industry, including software developers, cloud computing providers and hardware manufacturers.
Among its holdings are Palantir Technologies (NASDAQ: PLTR), which helps organisations analyse data and deploy AI, and Oracle (NYSE: ORCL), which provides the cloud infrastructure needed to run demanding AI applications.
It also owns Samsung Electronics, giving investors exposure to semiconductor manufacturing.
I think this approach makes sense because the financial benefits of AI are unlikely to be limited to a handful of companies.
As more businesses adopt the technology, there should be opportunities for companies supplying the software, infrastructure and services needed to make it work.
Global X FANG+ ETF (ASX: FANG)
A final ETF to consider buying is the Global X FANG+ ETF, which invests in 10 leading US technology and technology-related companies.
Its holdings include Microsoft (NASDAQ: MSFT), Amazon (NASDAQ: AMZN) and Alphabet (NASDAQ: GOOGL).
These businesses are investing heavily in AI, but they also have established operations and enormous customer bases that could help them turn the technology into additional revenue.
For example, Microsoft and Amazon can benefit from businesses spending more on AI through their cloud computing platforms. Alphabet, meanwhile, is incorporating AI into products used by billions of people.
I believe these companies are well placed to benefit as AI becomes more widely adopted.
And although the fund is concentrated and shares several holdings with the other ETFs, I think it offers a good way to invest in some of the companies commercialising AI on a global scale.
