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Global X brings first dedicated AI ETF to Aussie shores

By Jessica Penny
3 minute read

Australia’s first pure play AI ETF will be made available to investors amid “rapid advancements” in the market.

Global X is launching the Global X Artificial Intelligence ETF (ASX: GXAI) on the ASX, offering Australian investors exposure to innovation and growth in AI-related companies.

GXAI, which will be the first dedicated AI ETF launched in Australia, tracks the Indxx Artificial Intelligence & Big Data Index.

Moreover, the fund focuses on investing in companies along the AI value chain, including those involved in generative AI technology providing automation of systems and AI-as-a-service solutions.

Speaking on the upcoming launch, chief executive Evan Metcalf said the potential with the AI thematic is significant, with forecasts suggesting the global market could increase to US$300 billion by 2026.

“Artificial intelligence is still maturing, and with this natural evolution comes the potential opportunities for new applications,” Metcalf explained.

“GXAI offers investors a way to target the rapid advancements and capabilities of AI technologies across a range of industries and a diversified selection of companies.”

Citing that Global X has already seen a combined $125 million of inflows this year-to-date across Global X FANG+ ETF and the Global X Semiconductor ETF, which offer exposure to subsets of the AI theme, Metcalf believes there is a big appetite for AI-related ETFs in the local market.

“AI is not a flash in the pan, it’s a structural shift which will change industries and life as we know it.

“Australian investors can use GXAI to invest in leading companies across the value chain of this megatrend which are positioned to benefit from AI adoption and innovation. Hence, GXAI is a fitting addition to our product line-up as our thematic investing ethos is centred on longer-term opportunities.”

Scott Helfstein, head of thematic solutions at Global X, agreed that this momentum is expected to continue, having observed increased investor demand to capitalise on the growth potential of AI over the last 12 months.

“It is important for investors to have strong, well tested investment vehicles at their disposal to capitalise on this important thematic,” Helfstein said.

“While GXAI captures some of the most prominent names in the AI sector, such as Netflix, Adobe and Nvidia, it applies moderation through a single-stock cap exposure of 3 per cent.”

According to Helfstein, this acts as a “natural portfolio diversifier” and presents a more balanced portfolio which thoughtfully targets the AI theme.

Earlier this week, Global X announced that it had surpassed $7 billion in assets under management (AUM) and is on its way to achieving its objective of $10 billion in AUM by the end of 2025.