A senior executive of a fund manager specialising in exchange-traded funds (ETF) has suggested artificial intelligence (AI) investing is the most relevant theme currently for Australians due to their history of large portfolio weightings towards resource and financial stocks.
Global X US head of investment strategy Scott Helfstein noted his belief Australians need more exposure to technology companies in their investment portfolios began five years ago when the manager launched its FANG (Facebook, Amazon, Netflix and Google) ETF.
“The issue you guys had in Australia was you guys chronically under-owned technology three, four, five years ago relative to materials [and] financials,” Helfstein said during a media briefing in Sydney last week.
“I was pretty comfortable [back then] getting up in front of audiences saying FANG was not really what we needed in the US, but something you guys need here.
“Fast forward to now [and] it’s probably the AI [ETF we offer].”
He pointed out while a general increase in allocations to AI would be prudent for Australians, an investment in the Global X Artificial Intelligence Infrastructure ETF, trading under the Australian Securities Exchange ticker of AINF, would give people deeper exposure to the sector.
“What we do is cap the mega-cap exposure at 3 per cent … [If] you think about the concentration you get in mega-cap tech if you own any major indexes, [in the] Nasdaq for example it’s 40 per cent, [in] the S&P it’s 35 per cent, so I like the idea [the offering] distributes the capital further down the capital structure,” he explained.
“So [you’ll be getting exposure to companies] that maybe you don’t know yet and might be on the leading edge or might be the next ones to develop something.”
He said the emergence of the Deepseek AI application demonstrated how quickly changes occur and how thinking an allocation to Nvidia and Microsoft adequately covers the sector is flawed.
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