Investing with AI: 9 Best Performing AI-Based ETFs in June 2024

2024 was a big year for artificial intelligence launches.

OpenAI and Anthropic are no longer the only AI games in town. Several large technology companies, like Microsoft (MSFT)Snowflake (SNOW) and Meta (META)have announced new AI products in recent months.

Right now, there are two main ways investors can take advantage of the rise of AI. The first is to invest in AI, via AI Actions And AI ETF. The other is to invest in AI – using an AI assistant to help you. stock market researchor by investing in an AI-powered ETF.

What are some of the best applications of AI for investors?

Extensive investment research can involve a lot of reading – and AI assistants like OpenAI’s ChatGPT and Anthropic’s Claude can be useful for summarizing long snippets of text.

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For example, suppose you are considering investing in an actively managed company mutual fundbut you want to dig deeper into its holdings, fee structure, track record, etc. before investing.

The fund’s prospectus (which you can find by searching Google or the fund’s website) likely contains much of this information. But it can also contain more than 100 pages.

However, if you upload it to an AI assistant like ChatGPT or Claude, it should be able to summarize specific parts of it.

AI assistants can also be useful for brainstorming. If stock screeners aren’t your thing (they involve a lot of buttons), and you’re looking for, say, Clean Energy ETF it also pays dividendsyou can ask ChatGPT or Claude to list some for you.

For some people, “investing with AI” means using an AI assistant to help them with investment research or brainstorming. But for others, it means letting an AI select actions for them. This is the magic behind AI-powered ETFs.

What is an AI-powered ETF?

Some AI-powered ETFs, such as the Amplify AI Powered Equity ETF (AIEQ), give their AI the freedom to select a variety of different stock types. Others, like the WisdomTree US AI Enhanced Value Fund (AIVL), specialize in a specific type of stocks: undervalued stocksin the case of AIVL.

Top 9 Best Performing AI-Based ETFs in June 2024

Below is a list of the top 9 AI-based ETFs listed in the US on VettaFi, ranked by year-to-date performance.

The challenges of investing with AI

If you’ve been playing with chatbots like ChatGPT or Claude for a while, you may have noticed that they struggle with any type of math, including tasks as simple as counting.

These AIs are highly specialized in interpreting and generating text and images, not calculations. As an example, the screenshot below shows my attempts to get ChatGPT to generate an image of exactly eight elephants on a beach:

Source: OpenAI and author.

The countless AI chatbots are something to keep in mind if you’re using them to streamline your investing process. It’s always worth checking the numbers they spit out. Investors should probably avoid asking AI chatbots to do calculations – and they certainly shouldn’t ask them to predict where the stock market will go next.

With that in mind, the track record of AI-based ETFs might give some investors pause. Less than half of the funds listed above outperform S&P500 clue this year.

Certainly, AI technology is improving rapidly. ChatGPT may not be able to generate an image of exactly eight elephants on a beach, but it can generate very realistic images of elephants on a beach. In contrast, images generated by AI just two or three years ago were often too distorted to be recognizable.

AI-based ETFs could also improve significantly in the coming years – or continue to underperform. index funds. Only time will tell.

Neither the author nor the publisher held positions in the above investments at the time of publication.

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