20 Best-Performing AI ETFs for February 2024

Exchange-traded funds are one way to invest in artificial intelligence. THNQ and SPRX are some of the best-performing AI ETFs.
Sam Taube
By Sam Taube 
Updated
Edited by Chris Davis

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Nerdy takeaways
  • AI ETFs are tradable baskets of AI stocks — which are shares of companies that work on AI development.

  • Our AI ETF list includes broad technology ETFs and AI-specific thematic ETFs, but excludes AI-powered active trading ETFs.

  • You'll need a brokerage account to invest in AI ETFs. It's also important to pick an ETF that matches your investing goals.

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Artificial intelligence (AI) is one of the biggest trends of the 2020s — accounting and consulting firm PwC wrote that it could contribute $15.7 trillion to the global economy by the end of this decade, in a report first published in 2017 and last modified in 2023.

AI stocks provide one way for investors to try to profit from the growth of AI technology, but funds are also an option. Below, we’re unpacking AI exchange-traded funds (ETFs), and looking at the top nine AI ETFs by one-year performance.

» Looking for more general info on ETFs? Check out some of the best ETFs in terms of performance.

What are AI ETFs?

AI ETFs are publicly-traded baskets of AI stocks — which, in turn, are shares of publicly-traded companies that are involved with AI development in some way.

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Some AI companies, like Microsoft (MSFT), are involved in the development of AI software — for example, large language models such as ChatGPT. Others, like NVIDIA (NVDA), produce hardware that is important to industrial AI, such as graphics processing units.

Best AI ETFs by one-year performance

Below are the top-performing ETFs that either have substantial exposure to AI stocks, or whose fund managers use AI to inform their trading decisions, as ranked by one-year performance.

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ETF Name

1 Year

Spear Alpha ETF (SPRX)

59.11%

iShares U.S. Technology ETF (IYW)

51.09%

iShares Expanded Tech Sector ETF (IGM)

47.88%

iShares U.S. Tech Independence Focused ETF (IETC)

47.57%

Clockwise Core Equity & Innovation ETF (TIME)

45.68%

Fidelity MSCI Information Technology Index ETF (FTEC)

41.06%

iShares Global Tech ETF (IXN)

40.36%

Franklin Exponential Data ETF (XDAT)

37.19%

Invesco NASDAQ Internet ETF (PNQI)

36.08%

Global X Artificial Intelligence & Technology ETF (AIQ)

34.33%

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?

34.32%

?

32.89%

?

29.99%

?

27.03%

?

25.43%

?

24.28%

?

22.91%

?

20.95%

?

19.18%

?

18.74%

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Source: VettaFi. Data is current as of Feb. 2, 2024 and intended for informational purposes only, not for trading purposes.

Types of AI ETFs

If you take a closer look at the AI ETFs in the table above, you’ll notice that they fall into one of several categories:

  • Technology ETFs: Some of the funds above are really just baskets of tech stocks. We’ve included them here because some of the largest companies in the technology sector —such as NVIDIA and Microsoft — are also key players in the AI industry.

  • Thematic ETFs: Other funds are specifically focused on the theme of AI — although in practice, their holdings tend to look quite similar to those of general tech ETFs at the moment.

  • “AI-enhanced” or “AI-powered” ETFs: There’s a third type of AI ETF that bears mentioning here: Funds, such as the QRAFT AI-Enhanced US Large Cap ETF (QRFT), that are not focused on AI stocks or even technology stocks, but simply use AI technology to inform their trading decisions.

How to buy AI ETFs

You’ll need an investment account — such as a brokerage account or an individual retirement account (IRA) — to invest in AI ETFs.

Once you’ve opened such an account — and verified that your AI ETF of choice is available in it — then you’ll need to figure out what goals you’re looking to accomplish by investing in AI ETFs, and how they fit into your overall strategy.

AI technology has real economic potential, but if you’re investing the whole balance of your IRA into AI ETFs, then you’re literally betting your retirement on that technology's success. Investment diversification can protect you from the risks of putting all of your eggs in one basket, while still allowing you to allocate small portions of your portfolio toward up-and-coming trends like AI.

If you’re looking to make a long-term bet on the potential of AI technology, then you may be content to just buy an AI ETF with a market order and hold it long-term.

If you’re looking to day trade AI ETFs, on the other hand — say, to take advantage of short-term market fluctuations related to the trendiness of AI stocks — then you may want to consider using limit orders to get in and out of the trade at a favorable price.

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Frequently asked questions

The holdings of AI ETFs often contain hardware manufacturers like NVIDIA, which makes graphics processing units (GPUs) that are used in many AI applications — but they also generally contain companies like Microsoft, which has made largely software-related contributions to AI.

If you're looking for ETFs that invest specifically in the makers of GPUs and similar high-end computer hardware, semiconductor ETFs may be of interest.

AI has the potential to transform the global economy in the next couple of decades, adding what could be tens of trillions of dollars of value in the process. But like any industry, it has also has its hurdles — including concerns about AI safety, the prospect of government regulation of AI, and a recent leadership shakeup at OpenAI, the developer of the influential GPT AI models.

If you're looking to buy and hold AI ETFs because you believe in its long-term potential, then you don't necessarily need to worry about the day-to-day volatility of AI stocks; the question of "is now a good time to buy" is largely moot.

However, if you're looking to actively trade AI stocks or ETFs, then news-related fluctuations could provide opportunities to buy the dip or sell at a relative high. Keep in mind that day trading isn't right for everyone, and it's always a good idea to consult a financial advisor such as a certified financial planner about any trading decisions.

Neither the author nor editor held positions in the aforementioned investments at the time of publication.

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