Artificial intelligence (AI) is fast becoming a more mainstream technology and the ETF industry is not immune to AI product launches, says Lou Conrad, CFA, of COMPASS Wealth Management in Concord, Mass.
Two AI ETFs, each with a 0.75% expense ratio, have been introduced by Exchange Traded Concepts, a new ETF entrant.
Qraft Technologies, which is based in South Korea, uses AI to evaluate various types of factors and how they perform in different market environments, says Conrad.
The use of AI in selecting securities is a natural evolution of the technology, but Conrad points out that no meaningful track record exists to judge the extent to whether such an approach can add value on a consistent and extended basis.
"Investors may want to wait for products such as these to become more seasoned before deploying their capital," he says.
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