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ETF Strategist: Robotics and AI Will Be a Top Theme in 2020

This article was originally published on ETFTrends.com.

Investor participation and automation—it’s a top theme in 2020 that will persist as more technological advances take place in robotics and artificial intelligence (AI). As such, investors can look to an ETF like the Global X Robotics & Artificial Intelligence Thematic ETF (BOTZ) , which has more than $1.5 billion in net assets—a sign investors are aware of its importance for disruptive technology exposure.

“I think this is intuitive with investors,” said Jay Jacobs, head of research and strategy at Global X ETFs. “They see that automation is getting more powerful, that companies are investing in robotics, they’re investing in bringing in AI systems, but they don’t really know where to start. Who are the big robotics companies?” he said. “They’re not ... common knowledge to U.S. investors. The ETF, I think, is a perfect example of giving people that exposure to the companies best positioned in the space.”

BOTZ seeks to invest in companies that potentially stand to benefit from increased adoption and utilization of robotics and artificial intelligence (AI), including those involved with industrial robotics and automation, non-industrial robots, and autonomous vehicles.

Additionally, BOTZ seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Indxx Global Robotics & Artificial Intelligence Thematic Index. The index itself captures large and mid cap representation across 23 Developed Markets (DM) and 24 Emerging Markets (EM) countries.

From a trading standpoint, traders can use ETFs like the Robotics & AI Bull 3X ETF (UBOT) . UBOT seeks daily investment results equal to 300 percent of the daily performance of the Indxx Global Robotics and Artificial Intelligence Thematic Index, which is designed to provide exposure to exchange-listed companies in developed markets that are expected to benefit from the adoption and utilization of robotics and/or artificial intelligence.

The robotics space is certainly in a push-pull dichotomy of investors capitalizing on the latest in disruptive technology, while at the same time, getting push back from those threatened by the wider adoption of robots. The fears are warranted given that robotics technology has the capacity to supplant human jobs.

Key characteristics of UBOT:

  • The Indxx Global Robotics and Artificial Intelligence Thematic Index (IBOTZNT) is designed to provide exposure to exchange-listed companies in developed markets that are expected to benefit from the adoption and utilization of robotics and/or artificial intelligence, including companies involved in developing industrial robots and production systems, automated inventory management, unmanned vehicles, voice/image/text recognition, and medical robots or robotic instruments, as determined by the index provider, Indxx.
  • Companies must have a minimum market capitalization of $100million and a minimum average daily turnover for the last 6 months greater than, or equal to, $2 million in order to be eligible for inclusion in the Index.

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