When ChatGPT hit the scene a few months back, the rip-roaring rally for anything artificial intelligence related was on.
Fast forward to today, and said rally has flamed out rather quickly. Not only have the artificial intelligence-related stocks begun to give back their gains received during the rally, but there is a national backlash swirling across the US.
In Washington, both Congress and the President are questioning whether artificial intelligence is a good thing. President Biden recently said, "Technology companies have a responsibility to make sure their products are safe before making them public." He was asked if AI was dangerous and responded, "It remains to be seen. Could be."
Even Congress is looking into AI and its safety. A nonbinding measure was recently introduced by Rep. Ted Lieu, D-Calif., which will direct the house to look into artificial intelligence.
Interestingly enough, the bill was actually written by the chatbot ChatGPT, which really put AI in the spotlight.
ChatGPT became a household name and really started the AI rally on Wall Street after it was announced the popular website BuzzFeed was planning to use the chatbot to write articles and create content. This occurred on January 26th, 2023. AI technology began to come under fire at the end of March, early April 2023.
Although, even at the beginning of the ChatGPT explosion, some experts and journalists were already calling out ChatGPT for returning historically inaccurate information when asked basic questions. These mistakes raised concerns, even during the beginning of the AI hype, about how trustworthy artificially intelligent machines' answers would be.
The answer is only as reliable as where the answers are originally coming from.
See, the way ChatGPT and other chatbots work is that they just pull data from one place on the internet and give it to you in the form of an answer or article. Think of it like a Google search, but the answer is more specific, and there are only one, not thousands, for you to choose from.
And there lies the problem.
With an AI chatbot, we all want it to be correct with each and every answer. But how does it know the correct answer when it's pulling data from sources that aren't always correct?
Furthermore, what is even more freighting is if someone else wants the chatbot to give you an incorrect answer. Or perhaps even worse, someone wants to manipulate the way you think and your beliefs using a chatbot. The way people say Russians or others manipulated US elections using social media platforms.
There are a lot of things to consider when it comes to artificial intelligence projects and how safe they truly are at this time and will continue to be in the future.
However, at this point, Pandora's box is open, so it's hard to see a future without AI in some form or fashion. With that being said, let's look at a few exchange traded funds that you can buy now, while you wait for AI to dominate the world!
The first one I would like to point out is the ARK Autonomous Technology & Robotics ETF (ARKQ). This fund invests in several different futuristic technologies, making it good for any investor.
While you wait for AI technology to explode, ARKQ's holdings in autonomous driving or some other innovative technology may take off. The infamous Kathy Woods runs the fund, and despite her poor performance in recent times, she has a proven track record over the years.
A few of the other ETFs are the Global X Robotics & Artificial Intelligence ETF (BOTZ), the iShares Robotics and Artificial Intelligence Multisector ETF (IRBO), and the First Trust Nasdaq Artificial Intelligence and Robotics ETF (ROBT).
While the ARKQ ETF is focused on several different innovative technologies, AI being one of them, along with robotics, these three focus solely on AI and robotics. From a performance standpoint, all four ETFs are up double digits year-to-date. ARKQ and BOTZ have 37 and 44 holdings, respectively, while IRBO and ROBT have 119 and 112, respectively.
ARKQ is also the most expensive fund at 0.75% expense ratio, while BOTZ charges 0.69%, IRBO is the cheapest at 0.47%, and ROBT charges 0.65%. BOTZ is the largest fund with $1.75 billion under management, ARKQ is second with $922 million, then IRBO with $303 million, and ROBT with $237 million.
The biggest question you need to ask yourself is whether or not today is the best time to buy any AI-related stock. AI had its rally in late January, and now it's getting hit. So is today the best time to buy, or will prices fall in the future, giving you a better buying opportunity?
I honestly don't know. But, what I am sure of, is that AI technology is here to stay, and at some point, you should own some companies that operate in the AI space.
Leave me your thoughts below about whether today is a time to buy or wait on AI stocks.
Disclosure: This contributor did not hold a position in any investment mentioned above at the time this blog post was published. This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.