AI investments will go from ‘hot names’ to essentials

The AI trade continues to drive market gains, showing few signs of slowing. Defiance ETFs CEO and CIO Sylvia Jablonski joins Wealth! to offer insights on navigating markets during this AI-driven period.

Jablonski observes that investors currently associate the “Magnificent 7” tech giants with AI. Given this trend, she recommends semiconductor or large-cap ETFs as avenues for gaining exposure to these plays. She also emphasizes the importance of considering ETFs that offer exposure to core AI names and companies involved in AI infrastructure, staples, and hardware.

The Defiance ETFs CEO predicts AI will benefit multiple sectors, from healthcare to driverless vehicles, in the long run. She states, “AI is gonna touch just about everything, so I think we’re in the infancy stage, and the infancy stage is… who are the biggest hot names? And that’s what people are buying.” However, she anticipates a second stage where market focus will shift to companies essential for AI operations.

For more expert insight and the latest market action, click here to watch this full episode of Wealth!

This post was written by Angel Smith

Video Transcript

Wall Street is Abuzz with Nvidia’s rise to most valuable public company.

But for all the talk about A I’s influence, it’s easy to forget that A I technology is really in its infancy at this stage.

And investment opportunities are just starting to take shape more broadly in one way to dip your feet into the A I market could be through A I ETF S to help explain, we are joined by Sylvia Jablonski who is the defiance ETF S CEO and Cio as part of this week’s ETF report brought to you by QQQ Sylvia.

Great to see you.

Thanks for joining us in the studio.

Thanks for having me.

OK.

So a lot of people trying to figure out what is the best or any ETF way to play A I right now.

Where would you point to initially?

Well, you know, I think that A I is arguably the mag seven for now, right?

Everybody is most familiar with the Microsoft Chat GP T phenomenon and NVIDIA and AMD and whatnot.

So you can look at a straight semiconductor ETF if you want access to the semiconductor aspect of it, the NVIDIA is the ads and such, um you can also look at, you know, just a straight cues, large cap tech ETF because they hold those top, you know, mag seven fab five, whatever, whatever you wanna go with names there.

Um You can also look at some niche products that do like a broader spectrum type of thing.

So you know, we for example, run a quantum ETF where we look at the A I aspect of it, the machine learning aspect of it, the super computing aspect of it.

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So you’re not getting only A I but also the staples and you know, the conductivity, the communication, the the hardware, the software um that goes into it.

So I would say thematic ETF s your classic tech trades or the semiconductor ETF for good places to, to look outside of single stocks.

Is there a way to almost kind of divide between what is the B to B side of artificial intelligence who’s making the purchases of the NVIDIA client base that’s buying into the chips.

And then on the other side, those players that are creating the applications that consumers are actually touching.

Yeah.

And so that’s sort of how we look at it when we constructed our ETF because we think that they are the consumers and the providers of the staples.

But to your point, you know what’s tricky about that is every single sector out there is going to be consuming A I consuming chips, right?

So I think that health care will benefit from A I I think that aerospace and defense infrastructure will benefit electric vehicles, driverless cars, you know, A I is going to touch just about everything.

So I think we’re in the infancy stage and the infancy stage is sort of like who are the biggest hot names.

And that’s what people are buying.

And then stage two is going to be like, what do we need for A I to run?

And I think people start looking at things like uranium and copper and energy, right?

And then I think that people will look at things like tele you know, telecommunications, con tech connectivity, you look at things like five G, six G, right?

And then you look at companies like Lily and you know all the health care companies that have all these drugs and they’re gonna start using A I to to have more efficient outcomes and generate revenues through the use of A I.

So it’s going to touch everything to what extent are investors identifying or or at least evaluating right now where cyber security as an investment strategy also has that A I annexation because that is one of the core concerns by users, whether it be some of the businesses that are trying to build out data centers that are leveraging these chips that have influential tech technology abilities.

And then the core users, the customers like you and me that are just saying I just know that it gets to me and that I’m able to tap into it, open up an app and it’s going to based on what I prompt return something that is saving me time.

Yeah.

And actually, so you just gave me two new ideas for ETF S to look at that.

I love doing that.

You gotta, you have to look at the cloud ETF S and you have to look at the cyber security ETF S. And so that’s a great point.

Um The idea there is that we’re going to have all of this data, right?

And this data somehow needs to be protected and it needs to be housed so cloud for the housing.

That’s your Amazon’s your Microsoft.

Um And then you have your, you know, the Cyber security side with the Palo Altos and, and you know, some of these other types of companies, so two other great spots to, to look at and absolutely, that’s gonna be a massive theme, especially when you think about some of the concerns we have right now with like Tik Tok and, you know, trade relations with some of our Asian counterparts and you know, the world that cyber security is going to have to play there, throw A I into the mix and yeah, that’s another massive compounded annual growth uh opportunity.

In my opinion, it sounds like I make, I might make it into my first ETF white paper.

I’m not sure, I’m not sure I’m just throwing it out.

You’re just about that.

Sopha Jablonsky defines ETF CEO and Cio.

Great to see you.

Thanks so much for joining.

Thanks for having me.