Artificial Intelligence (AI) is one of the powerful mega forces reshaping the global economy. There are several ways to approach this theme for investors seeking exposure to AI.
The primary reasons that make AI a more enduring investment opportunity is when we compare to prior waves of technology via the PC, the smartphone, the internet, the cloud, those are all amazing productivity tools. AI however, represents something quite different. This is, akin to building intelligence. Manufacturing intelligence. And this is something that we've not seen before.
And in this regard, it has actually consolidated and captured the entire emphasis of the entire technology industry. So for the balance of this decade, I would suspect that AI will be the predominant driver of growth.
Disclosures:
Past performance does not guarantee future results.
This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed are as of the date indicated and may change as subsequent conditions vary. The information and opinions contained in this material are derived from proprietary and nonproprietary sources deemed by BlackRock to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by BlackRock, its officers, employees or agents. This material may contain “forward-looking” information that is not purely historical in nature. Such information may include, among other things, projections and forecasts. There is no guarantee that any of these views will come to pass. Reliance upon information in this material is at the sole discretion of the viewer.
This material contains general information only and does not take into account an individual's financial circumstances. This information should not be relied upon as a primary basis for an investment decision. Rather, an assessment should be made as to whether the information is appropriate in individual circumstances and consideration should be given to talking to a financial professional before making an investment decision. This material does not constitute any specific legal, tax or accounting advice. Please consult with qualified professionals for this type of advice.
Prepared by BlackRock Investments, LLC, member FINRA.
©2024 BlackRock, Inc or its affiliates. All rights reserved. iSHARES and BLACKROCK are trademarks of BlackRock, Inc. or its affiliates. All other marks are the property of their respective owners.
iCRMH1024U/S-3908547
AI-related ETFs aim to capture the broad impact of AI technologies, offering exposure to a cross-section of companies that could stand to benefit from AI advancements.
Historic infrastructure investment
AI's growth has been driving a historic capital expenditure cycle across the broader infrastructure of this technology, spanning many sectors and industries.1
Semiconductor revenue surge
The AI chip market could surge, reaching $1 trillion in revenue by 2030, providing a broad investment avenue for investors.2
Energy demand growth
Critical IT power capacity in the U.S. will need to triple from 2023 to 2027, and surge well beyond, to keep pace with rising demand driven by AI.3
The release of ChatGPT in late 2022 reignited global interest in AI, marking the beginning of a new era. The AI revolution is not merely about building new tools, it is about developing systems that think, reason, act, and adapt like humans.
AI models increase in performance with more compute and data. The number of parameters proxies the complexity and capability of AI models.
Source: BlackRock, August 31st, 2024. For illustrative purposes only. There is no guarantee that any forecasts made will come to pass.
Chart description: Line chart showing the growth in AI model complexity over time, measured by the number of parameters. It tracks models like GPT, GPT-2, GPT-3, and GPT-4, highlighting future models expected to reach trillions of parameters.
Investing in AI-related ETFs doesn't have to be complicated. iShares offers several ways to access the AI theme, from pure-play technology exposures to products targeting the broader AI ecosystem.
of articles
Investors may consider investing in AI as it is reshaping industries and economies around the world. AI's rapid growth demands significant investment in infrastructure like data centers, semiconductors and raw materials, offering an opportunity for investors to tap into a market that could be poised for significant growth.
AI technology has been driving a historic capital expenditure cycle, with significant infrastructure investments needed for data centers, semiconductors, and power. This buildout is anticipated to continue for years, offering an opportunity for investors to participate in the AI theme.4
In our view, active investment strategies will be key to identifying likely winners over time and active stock investors with deep technical knowledge may be best suited to navigate this space. Investors interested in the AI theme may also choose pure-play or complementary exposures targeting themes within the broader AI ecosystem.
Investing in AI focuses on a specific transformative technology with growth potential, while tech sector investments cover a broader range of companies and innovations. AI investment offers a targeted approach to a sector driving significant infrastructure and economic changes.
iShares offers AI-related ETFs that bring potential solutions to investors looking to harness the potential growth opportunities stemming from AI technology, spanning across active approaches to AI and global tech to exposure to the full AI value chain.
BlackRock uses AI to inform investment decisions, analyze large data sets, and help understand complex problems and to enable investment professionals to develop innovative investment approaches.
Investing in AI carries risks such as data inaccuracy, intense competition, rapid product obsolescence, and dependency on consumer base and end-user demand. Companies may also face sector-specific market and business risks, affecting overall performance.
Our Funds
ASSET CLASS
Investment Strategies
EXPLORE NOW
GO FURTHER
Market Insights
EXPLORE NOW
MARKET INSIGHTS
ETF FLOWS
Education
BASICS OF INVESTING
ETF STRATEGIES
KEY TRENDING TOPICS
Resources
INSTITUTIONAL INVESTORS
About Us
GET TO KNOW iSHARES
iShares unlocks opportunity across markets to meet the evolving needs of investors. With more than twenty years of experience, iShares continues to drive progress for the financial industry. iShares funds are powered by the expert portfolio and risk management of BlackRock.
© 2024 BlackRock, Inc. All rights reserved.
1 BlackRock, "Thematic Mid-Year Update," June, 2024. Forward-looking estimates may not come to pass.
2 McKinsey & Company “The Semiconductor decade: a trillion-dollar industry” as of April 1, 2022. Net growth calculated based on total revenue of $590B in 2021, with a $125b growth in revenue of computing and data storage from 2021 to 2030, accounting for 25% total net growth of the global semi market at $475B. Forward-looking estimates may not come to pass.
3 Semianalysis, “AI Datacenter Energy Dilemma- Race for AI Data Center Space.” As of March 13, 2024. Forward-looking estimates may not come to pass.
4 BlackRock, "Thematic Mid-Year Update," June, 2024. Forward-looking estimates may not come to pass.
Carefully consider the Funds' investment objectives, risk factors, and charges and expenses before investing. This and other information can be found in the Funds' prospectuses or, if available, the summary prospectuses, which may be obtained by visiting the iShares Fund and BlackRock Fund prospectus pages. Read the prospectus carefully before investing.
Investing involves risk, including possible loss of principal.
Funds that concentrate investments in specific industries, sectors, markets or asset classes may underperform or be more volatile than other industries, sectors, markets or asset classes and than the general securities market.
International investing involves risks, including risks related to foreign currency, limited liquidity, less government regulation and the possibility of substantial volatility due to adverse political, economic or other developments. These risks often are heightened for investments in emerging/ developing markets or in concentrations of single countries.
Negative changes in commodity markets could have an adverse impact on companies the Fund invests in. The price of the equity securities of companies engaged in mining and the price of the mined metals may not always be closely linked. Worldwide metal prices may fluctuate substantially over short periods of time, so the Fund's share price may be more volatile than other types of investments.
Actively managed funds do not seek to replicate the performance of a specified index, may have higher portfolio turnover, and may charge higher fees than index funds due to increased trading and research expenses.
Technology companies may be subject to severe competition and product obsolescence.
Convertible securities are subject to the market and issuer risks that apply to the underlying common stock.
Securities issued in IPOs have no trading history, and information about the companies may be available for very limited periods. In addition, the prices of securities sold in IPOs may be highly volatile or may decline shortly after the IPO.
Preferred stocks are not necessarily correlated with securities markets generally. Rising interest rates may cause the value of the Fund’s investments to decline significantly. Removal of stocks from the index due to maturity, redemption, call features or conversion may cause a decrease in the yield of the index and the Fund.
Investing in long/short strategies presents the opportunity for significant losses, including the loss of your total investment. Such strategies have the potential for heightened volatility and in general, are not suitable for all investors.
A fund's use of derivatives may reduce a fund's returns and/or increase volatility and subject the fund to counterparty risk, which is the risk that the other party in the transaction will not fulfill its contractual obligation. A fund could suffer losses related to its derivative positions because of a possible lack of liquidity in the secondary market and as a result of unanticipated market movements, which losses are potentially unlimited. There can be no assurance that any fund's hedging transactions will be effective.
The iShares Funds are not sponsored, endorsed, issued, sold or promoted by Bloomberg, BlackRock Index Services, LLC, Cboe Global Indices, LLC, Cohen & Steers, European Public Real Estate Association (“EPRA® ”), FTSE International Limited (“FTSE”), ICE Data Indices, LLC, Nasdaq, Inc., NSE Indices Ltd, JPMorgan, JPX Group, London Stock Exchange Group (“LSEG”), MSCI Inc., Markit Indices Limited, Morningstar, Inc., Nasdaq, Inc., National Association of Real Estate Investment Trusts (“NAREIT”), Nikkei, Inc., Russell, S&P Dow Jones Indices LLC or STOXX Ltd. None of these companies make any representation regarding the advisability of investing in the Funds. With the exception of BlackRock Index Services, LLC, who is an affiliate, BlackRock Investments, LLC is not affiliated with the companies listed above.
Neither FTSE, LSEG, nor NAREIT makes any warranty regarding the FTSE Nareit Equity REITS Index, FTSE Nareit All Residential Capped Index or FTSE Nareit All Mortgage Capped Index. Neither FTSE, EPRA, LSEG, nor NAREIT makes any warranty regarding the FTSE EPRA Nareit Developed ex-U.S. Index, FTSE EPRA Nareit Developed Green Target Index or FTSE EPRA Nareit Global REITs Index. “FTSE®” is a trademark of London Stock Exchange Group companies and is used by FTSE under license.
The Funds are distributed by BlackRock Investments, LLC (together with its affiliates, "BlackRock").
© 2024 BlackRock, Inc or its affiliates. All Rights Reserved. BLACKROCK, iSHARES, iBONDS, LIFEPATH, ALADDIN and the iShares Core Graphic are trademarks of BlackRock, Inc. or its affiliates. All other trademarks are those of their respective owners.
iCRMH1024U/S-3942314