How Robotics and Artificial Intelligence are shaping our future

When ChatGPT-3.5 launched at the start of 2023, even its creators could not have foreseen its rapid adoption. The internet quaked as the app gathered one hundred million users in the first two months from its launch¹. Artificial intelligence (AI) moved from being a Hollywood thought experiment to, potentially, creating as profound a change as the internet.

So what are artificial intelligence and robotics?

AI is any technique that enables computers to complete tasks that typically require human intelligence. Robotics are part of the same complex. Chatbots, humanoid robots, or machines that are trained on data to perform certain tasks.

In ChatGPT’s case, the AI language model can answer questions and help with the writing of anything from emails to code. ChatGPT is perhaps the best known, but there are numerous other purposes for which AI is already being used, including autonomous driving, interpretation of data and fraud prevention. In each case, machines analyse vast amounts of data to find solutions to problems in a way that already far exceeds limited human capabilities today.

How AI could change the world

Robotics and AI are seen as playing a key role in business efficiency and digitisation. It has the power to leverage human productivity and potentially build economic growth.

It could also help to tackle complex problems resulting from some of the most intractable issues facing the world today. For example, ageing populations will likely take vast swathes of people out of the workforce, while also increasing the need for care. AI can help by automating repetitive tasks, while robots are increasingly used to help with elderly care. The use of robots in healthcare is expected to rise from USD 4.1 billion in 2022 to USD 8 billion by 2032, something completely underpinned by AI integration into healthcare².

It can also be part of the solution to the climate crisis, promoting efficient energy use and distribution. In manufacturing and factory automation it can also have multiple uses. Companies such as Regal Rexnord, Symbotic Systems and Daihen are in fact already using specialist robots and machine learning to improve conveyor belt processes, stock loading and unloading, and warehouse automation.

It is worth saying that these efficiencies may come with a cost. The European Parliament estimates AI in the workplace can result in the elimination of certain jobs, with administration, legal and engineering jobs particularly vulnerable. This could be a long-term problem for policymakers.

Investing in robotics and AI through ETFs

If you want to invest in robotics and AI, there are two areas of opportunities you could consider:

1. Companies that are directly involved in the creation of AI and robotics. These may be US based companies like Nvidia or Intel, which are designing specific AI-Chips, certain European semiconductor suppliers such as Infineon or STMicroelectronics or even cloud providers like Oracle or the software giant Microsoft.
2. The second potential area of opportunity lies with companies that are making use of AI and robotics to deliver better services, or create their products more efficiently.

Robotics and AI are multi-generational, disruptive trends. The impact for businesses and individuals could be revolutionary. Investors who share this view, may access this megatrend through simple, transparent and cost-efficient ETFs, which are a basket of stocks made of companies with exposure to these activities, and therefore not taking on the risk of investing in individual stocks.

The Amundi MSCI Robotics & AI ESG Screened UCITS ETF seeks to replicate, as closely as possible, the performance of the MSCI ACWI IMI Robotics & AI ESG Filtered Net Total Return Index. Top 10 holdings of the fund³ include companies like Nvidia Corp., Intuitive Surgical Inc., Apple Inc., Advanced Micro devices and Oracle – a real mix of companies in different sectors, like Information Technology, Healthcare, Communication Services, Industrials, among others. The ESG screen allows the product to meet minimum ESG standards, by selecting the top 75% of companies by sector-relative ESG rating while excluding controversial business.

Amundi MSCI Robotics & AI ESG Screened UCITS ETF
ISIN: LU1861132840
Management fees*: 0.40%
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1. Source: https://www.reuters.com/technology/chatgpt-sets-record-fastest-growing-user-base-analyst-note-2023-02-01/, published on 27/07/2023.
2. Source: https://www.precedenceresearch.com/healthcare-service-robots-market, last viewed on 21/08/2024.
3. Source: Amundi ETF, as of 19/08/2024.

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