What is Artificial Intelligence?
We all heard about Artificial Intelligence, but we don't know what this is about. Artificial intelligence has been used in various fields such as robotics, informatics, finances, health, autonomous transportation systems, video games and telecommunications. In the last decade, There was a 400% increase in patent application for the implementation of artificial intelligence.Artificial Intelligence refers to computer systems that seek to mimic human cognitive function through machines, processors and software to perform data processing and analysis tasks. It is a definition that if we lower it on land we could be talking about machines designed to reason, learn, perform actions and solve problems. Abarca de softwares como virtual assistants, search engines or voice and face recognition systems, up to integrated systems such as robots, drones and autonomous vehicles.After very comprehensive data collection and processing, the machines act with a specific goal: they are able to handle large amounts of data that allow them from identifying and understanding verbal commands and images, until they perform complex calculations and actions with a high speed.The simplest example about how artificial intelligence is applied begins with personal experience through assistance through smartphones, tablets and computers. But it covers all kinds of activities as in the productive sector through ensamble and automation in factories and laboratories, the detection of fraud in the financial system began to be used, and also in the health sector, for example, by identifying genetic factors that anticipate the detection of diseases.
Tesla surprised us with his self-contained automobile algorithm and its incorporation in the manufacture of autonomous and intelligent vehicles, but also begins with the simple fact of having to communicate with a virtual assistant with voice recognition.Work with Artificial Intelligence It will be a great advance in computing and in many other fields. For example, when looking for a photo on Google, the searcher-like photo suggestions do not put them on behalf, but with artificial intelligence based on similar images.
How can we invest in it?
Investing in Artificial Intelligence in the bag was never easy. Either there are companies that dedicate themselves to this and have no liquidity (or are only projects), or it is a relatively new issue that is part of a set of technological giants that is only part of a minimum part of their evaluation and very difficult to measure their impact on the rest of their companies. Among these latest Microsoft (MSFT) and Google (GOOGL) companies have given that to talk lately.Microsoft (MSFT) presented a breakthrough of integrations that will have ChatGPT, the artificial intelligence of OpenAI company. ChatGPT is a tool to generate texts from user queries or questions. This artificial intelligence will work as a "pilot" for the web, and will consist of the development of a new Bing engine (the Microsot seeker) that can answer questions directly and a new Edge browser. In February 2023, the company announced the new focus that it will seek the information search experience to be more organized thanks to these softwares, which will work similarly to that of a companion during the user session. It will improve searches and not only bring results in the form of links and images, but also have the ability to answer questions, in addition to constantly interacting with the software through a virtual chat that will allow content generation and the exploitation of users' creativity. It will be based on a next-generation language model. In addition to suggestions, the surveys will be accompanied by a sidebar in which ChatGPT will be shown with more personalized and elaborate responses for each occasion.On the other hand, and after several months of development, Google (GOOGL) announced the launch of what will be its new artificial intelligence software called Bard and which will be based on the development of artificial intelligence called LaMDa. In addition to this technology it applies the programsPaLM and MusicLM that work as the base. This advance will be integrated into your searcher's services and will provide users with up-to-date information about any query they may perform. It will be a much smaller model that requires significantly less computational power, which allows you to scale more users, more comments and feedback, and more security to protect users from possible bad practices or harmful information.
In the bag there is an ETF that replicates all companies linked directly with artificial intelligence. They form it from young and unknown companies to Tesla (TSLA) and Prudential (PRU). Operates since 2017 with an annual administration expenditure of 0.75% and with assets under USD 122.35 management M, that is, relatively little for the funds industry.
Financials lead weight by sector with 18.72%, followed by Health Technology with 17.36% and Consumption with 12.44%. Among the main positions we find Novavax (4.14%), UnitedHealth Group (3.58%), Constellation Energy (3.57%), Zoetis (3.22%), Tesla (2.90%), among others and well diversified. Neither MSFT nor GOOGL are part of the top ten.
His quotation experienced a strong upward during post-pandemics, to disarm the posteriori as all risk assets. Only now is it recovering:
AI Powered Equity ETF (AIEQ): Quotation evolution 2017-2023 (month)
Source: TradingView
The beta is 1.19, which means it is a little more volatile than the market, as it was to wait (tampoco so much).No one chooses this ETF for its dividends (0.6%), because it is not such a type of company and also has a devaluation rather below the market to judge by its Priceto-earnings of 13x (and a price at value books of 2.7%, in line with the market, but below growth companies).
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