Dramatic jump in AI ETFs despite rough quarter
Despite market volatility, investors are increasingly shifting capital into AI-themed exchange-traded funds (ETFs). Analysts suggest that ETFs are gaining popularity over mutual funds due to tax advantages and the growing integration of AI into infrastructure.
Why it matters
The shift in investment vehicles reflects broader trends in how retail investors access emerging technology sectors.
Wall Street is banking heavily on exchange-traded funds that give investors artificial intelligence exposure, according to J.P. Morgan Asset Management.
The firm's "Guide to ETFs," which came out this month, finds it's a top five theme by assets under management — even as volatility hit the group in the second quarter.
"Many [themes] are morphing towards AI and the ecosystem surrounding AI," Jon Maier, the firm's chief ETF strategist, told CNBC's " ETF Edge " this week.
Maier, who led the insights team that published the report, also highlighted an overlapping relationship between AI-themed ETFs and infrastructure.
"It's all kind of feeding into the AI story … the applications, the energy [and] the AI models," he said.
JPMorgan's Guide to ETFs also found that mutual fund overall inflows are meaningfully tapering off while more money is flowing into ETFs.
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