If there’s one hot topic in this year’s stock market, AI surely makes the list. From NVIDIA, the so-called "shovel seller" , to TSMC, AI-related stocks are spreading rapidly.
As an investor, you’re likely interested in the future of the AI industry. Therefore, AI ETF, which brings together related AI companies as a package, might be an option worth exploring.
What are AI Concept Stocks?
Artificial Intelligence (AI) refers to the simulation of human-like intelligence and capabilities in machines, enabling them to perform a wide range of tasks. Applications of AI span across various domains, including autonomous vehicles, humanoid robots, healthcare innovations, AI-driven computing systems, and smart devices such as smartphones. Broadly speaking, companies that heavily invest in or are significantly engaged in AI-related businesses are categorized as AI concept stocks.
Taiwanese companies are primarily positioned in the upstream and midstream sections of the AI supply chain, handling key component manufacturing and server production, while the downstream sector includes many well-known American tech giants focused on computing power and cloud applications.
Below we would introduce four Taiwan AI related ETFs that cover prominent AI companies in both domestic and international markets.
AI Related ETF
Cathay Nasdaq A.I. & Robotics ETF (00737)
This ETF tracks the Nasdaq CTA Global AI and Robotics Index, which, as its name suggests, covers AI and robotics companies globally. It uses an “enhanced equal-weight” approach, with the top ten holdings making up only 20% of the total weight, and is well-diversified across upstream, midstream, and downstream companies, focusing mainly on software companies. This approach may suit investors who prefer not to have a concentrated portfolio.
Yuanta STOXX Global Artificial Intelligence ETF (00762)
00762 follows the STOXX Global Artificial Intelligence Index, selecting stocks where AI-related revenue exceeds 50%. This ETF is relatively concentrated, with its main holdings including globally recognized large corporations, such as Nvidia, Meta, and Microsoft. In Taiwan, the ETF includes stocks such as Macronix (2337), ASMedia (5269), Alchip-KY (3661). However, since 00762 trades both domestic and foreign stocks, it has the highest management fee among the four ETFs, so investors should be aware of the embedded fees.
Taishin SG Gl Artificial Intlg Rbt Sel ETF (00851)
00851 tracks the SG Global AI and Robotics Select Index. Companies in this index are identified through industry analysis, data mining, and expert consultation, focusing on those benefiting from AI technology. This includes companies that utilize AI for operations, such as Walmart, which employs AI for supply chain management and inventory forecasting. Similar to 00762, 00851 primarily holds large-cap stocks, with its top ten holdings accounting for over 50% of the total.
KGI Taiwan Premium Selection AI 50 ETF (00952)
Launched on August 16th this year, 00952 tracks the TIP FactSet Taiwan AI 50 Index. Its stock selection criteria are more complex, as it prioritizes AI revenue share, operational efficiency, growth trends, and stable dividends. This ETF employs a unique seasonal adjustment mechanism and monthly dividend policy. After this selection process, the top ten holdings include major Taiwanese companies such as VIS (5347) and Hon Hai (2317), covering leading companies across Taiwan’s AI supply chain from upstream to downstream.
Summary Comparison
| Cathay Nasdaq A.I. & Robotics ETF (00737) | Yuanta STOXX Global Artificial Intelligence ETF (00762) | Taishin SG Gl Artificial Intlg Rbt Sel ETF (00851) | KGI Taiwan Premium Selection AI 50 ETF (00952) | |
|---|---|---|---|---|
| Stock Selection Features | AI and robotics-related | AI-themed with revenue over 50% | Companies "benefiting" from AI | Comprehensive screening with seasonal adjustments |
| Dividend Policy | No dividend | No dividend | Annual dividend | Monthly dividend with income equalization reserve |
| Management Fee/Expense Ratio (Annual) | 0.85% / 0.25% | 0.90% / 0.26% | 0.75% / 0.25% | 0.4% / 0.035% |
| Constituent Stocks | Diversified, software-focused; 107 stocks (Meta, Palantir) | Large tech stocks such as NVIDIA, Microsoft; 80 stocks (Meta, Alphabet, Microsoft, Nvidia, AMD) | Multi-industry, e.g., Walmart, Tesla; 45 stocks (Tesla, Meta, Apple, Microsoft, Nvidia, Alphabet, TSMC) | Primarily large Taiwanese stocks; 50 stocks (VIS, Hon Hai, TSMC, Delta Electronics, Elite Material) |
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