With widespread adoption expected to continue across various industries, the robotics sector is projected to see major growth in the years to come.
To give an idea of the investment opportunities in robotics, data from Mordor Intelligence shows that the industrial robotics market will grow at a compound annual growth rate (CAGR) of 13.4 percent from 2024 to reach US$79.87 billion by 2029. The global service robot sector is also slated to experience significant growth in the coming decade, states Markets and Markets, growing at a CAGR of 15.4 percent to reach US$84.8 billion by 2028.
With the robotics market poised to thrive in the coming years, the industry is certainly garnering attention from investors. Exchange-traded funds (ETFs) are a popular way for interested individuals to get exposure to an overarching market, and there are a number of robotics ETFs available for those interested in the space.
1. Global X Robotics & Artificial Intelligence Thematic ETF (NASDAQ:BOTZ)
AUM: US$2.78 billion
First on this robotics ETFs list is the Global X Robotics & Artificial Intelligence Thematic ETF, which launched on September 12, 2016. It has 44 holdings and is targeted towards investors interested in companies that potentially stand to benefit from increased adoption and utilization of robotics and artificial intelligence (AI).
Large-cap companies make up 51.5 percent of its holdings, while 7.73 percent are small caps. In terms of sector breakdown, companies catering to the producer manufacturing sector have a weightage of about 41 percent in the ETF, and 23.4 percent are companies in the electronic technology space.
NVIDIA (NASDAQ:NVDA), ABB (NYSE:ABB), Intuitive Surgical (NASDAQ:ISRG), Keyence (TSE:6861) and SMC (TSE:6273) are among the ETF’s top holdings.
2. ROBO Global Robotics & Automation Index ETF (ARCA:ROBO)
AUM: US$1.3 billion
Created on October 22, 2013, the intention of the ROBO Global Robotics & Automation Index ETF is to provide investors with exposure to the rapidly evolving robotics, automation and AI industries.
This ETF currently has 78 holdings across over 15 countries in developed and emerging markets. In terms of market cap breakdown, 43.5 percent of its picks are large-cap stocks, while 17.5 percent are small-cap companies.
The fund’s top holdings include Teradyne (NASDAQ:TER), Zebra Technologies (NASDAQ:ZBRA), Intuitive Surgical, Kardex Holding (SWX:KARN) and IPG Photonics (NASDAQ:IPGP).
3. iShares Robotics and Artificial Intelligence ETF (ARCA:IRBO)
AUM: US$682.63 million
The iShares Robotics and Artificial Intelligence ETF is the most recent ETF on this list, having launched on June 26, 2018. It gives investors exposure to companies that spearhead robotics and AI innovation.
This robotics ETF has 110 holdings and consists mostly of large-cap companies at 48.25 percent and mid-cap companies at 28.1 percent. Companies involved in technology services account for 45.4 percent of its constituents, while 32.7 percent are involved in the electronic technology segment.
The top holdings of the ETF include MicroStrategy (NASDAQ:MSTR), NVIDIA, ARM Holdings (NASDAQ:ARM) and Spotify Technology (NYSE:SPOT).
4. First Trust NASDAQ Artificial Intelligence & Robotics ETF (NASDAQ:ROBT)
AUM: US$554 million
Launched on February 21, 2018, this ETF was designed to track the performance of companies involved in AI, robotics and automation.
The First Trust NASDAQ Artificial Intelligence & Robotics ETF has 109 holdings, with 70 percent involved in technology and 18.6 percent focused on producer manufacturing. Roughly 50 percent of its holdings are large-cap companies, followed by mid-cap companies at 27.6 percent and small caps at 18.5 percent.
The top holdings for this ETF include Darktrace (LSE:DARK), AeroVironment (NASDAQ:AVAV), Valeo (CBOE:FRP), Mobileye Global (NASDAQ:MBLY) and Blackberry (NYSE:BB,TSX:BB).
5. Direxion Daily Robotics, Artificial Intelligence & Automation Index Bull 2x Shares (ARCA:UBOT)
AUM: US$41.41 million
The Direxion Daily Robotics, Artificial Intelligence & Automation Index Bull 2X Shares first came to the market on April 19, 2018. The Global X Robotics & Artificial Intelligence Thematic ETF, mentioned above, is its majority holding with a weightage of 53.28 percent. The remainder of its assets are US dollars.
This product tracks the Indxx Global Robotics and Artificial Intelligence Thematic Index, which provides exposure to public companies in developed markets that could benefit from the adoption and use of robotics and AI.
Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
