‘A Simple Way’: CHAT ETF is One Way to Get Great Exposure to AI, Says Investor

For those investors looking to go long on the AI craze, the options can be quite confusing. Should investors seek to find a nuts-and-bolts stock building the GPUs powering the technology, a cloud service provider where the so-called magic happens, or go all-in on one of the many enterprise software options taking the market by storm?

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Those unsure of where to go, or who prefer to put their hands in numerous baskets, just might find the **Roundhill Generative AI and Technology ETF **($CHAT)an intriguing option. At least that’s the opinion of investor Anthony Di Fizio.

“The Roundhill Generative AI and Technology ETF is a simple way for investors to buy an entire portfolio of leading AI stocks,” explains the investor.

Di Fizio points out that slightly over 20% of the ETFs portfolio revolves around some of the bigger names out there: Alphabet, Nvidia, Micron, and Amazon. Needless to say, he also notes that these companies have been on an incredible run over the past few years, as the AI craze took flight.

That’s part of the reason that the ETF has had blistering returns of 136% since its inception in May 2023. In that sense, CHAT has succeeded in “obliterating” the S&P 500’s return of some 60% during that same period, emphasizes Di Fizio.

Of course, it’s not all sunshine and rainbows, cautions the investor, who notes that the ETF’s expense ratio of 0.75% is significantly higher than Vanguard’s VOO, which is designed to mirror the S&P 500 and charges 0.03%. Though it might not sound like much, Di Fizio acknowledges that these charges can add up.

In addition, CHAT doesn’t have much of a proven track record, as it hasn’t even reached three years of operations. Moreover, these years have been exceptionally lucrative ones for the AI sector, meaning that the jury is still out on how well the ETF will successfully manage rougher waters. (This year, for instance, CHAT is down almost 8% as fears of an AI bubble have weighed on both hardware and software companies alike.)

Di Fizio therefore urges investors not to get carried away and put all their eggs in this basket. He does, however, think it’s worthwhile to place at least a few of them there.

“It could be a great addition to a portfolio of other ETFs and individual stocks that currently lack exposure to the AI boom,” concludes Di Fizio. (To watch Anthony Di Fizio’s track record, click here)

Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

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