Artificial Intelligence (AI) is currently making significant waves in the technology industry. Numerous semiconductor and tech giants are channeling substantial investments into AI, and it’s evident that AI’s influence is here to stay. However, despite its promising future, the AI market remains in its nascent stage, and some short-term volatility may be expected.

If your risk appetite permits, exploring investments in AI company stocks or semiconductor Exchange-Traded Funds (ETFs) should be considered within the ‘alternative’ asset allocation category. It’s important to bear in mind that your overall allocation to this category, which includes other stocks or ETFs categorized as ‘alternative,’ should not exceed 10-15% of your total portfolio.

The largest AI companies are Amazon, Nvidia, Microsoft, Alphabet (Google), and Apple. The most broadly diversified and least expensive ETF in the AI space is the iShares Semiconductor ETF (Ticker: SOXX).

Investing inherently carries risk, and it’s these calculated risks that often yield rewards. Managing and assessing the risk associated with AI investments is crucial, as it can lead to well-informed and potentially profitable decisions.

Looking for an independent fiduciary financial advisor who can advise you on investments, retirement, real estate, alternative assets, and taxes? Contact ACap Advisors & Accountants to schedule a free initial consultation. Our clients include individuals, small businesses, entrepreneurs, and anyone serious about saving and investing for their future.