BOTZ Stock Takes the Guesswork Out
The Nasdaq retook the 8,000-point threshold on June 20 and may be setting up for a move back to its record high achieved on April 29.
But rather than playing the Nasdaq, there are strategies to assume a more focused approach and target those areas of technology that will likely outperform.
Here I’m talking about next generation technologies such as robotics and annotation, artificial intelligence (AI), and machine learning.
Other than the obvious behemoth mega-caps, there are numerous companies that may not be as well-known but offer investors a great alternative to partake in these areas.
And a strategic way to take some of the guesswork out of trying to choose the right stock is through the use of Exchange Traded Funds (ETF).
As a stock picker, I rarely look at ETFs, but that doesn’t mean you also need to do the same.
For instance, those beginning out in the investment space, or those with minimal capital, may want a more diversified approach to having to bet on a stock.
An intriguing ETF that may satisfy your needs is the Global X Robotics & Artificial Intelligence ETF (NASDAQ:BOTZ), which is up 22.64% this year and outperforming the Nasdaq and S&P 500.
Chart courtesy of StockCharts.com
This ETF tracks the Indxx Global Robotics & Artificial Intelligence Thematic Index. It must have at least 80% of its capital invested in the index.
For an ETF, BOTZ has a relatively low annual expense ratio of 0.67%, which means the cost of holding the ETF won’t take a big chunk out of your return. (Source: “Global X Robotics & Artificial Intelligence ETF (BOTZ),”Yahoo! Finance, last accessed June 20, 2019.)
The BOTZ stock ETF is comprised of mid-to-large-cap stocks from around the world, regardless of location.
As far as the sector allocation, Technology is the top area if of investment with 45.76%. Next is Industrials at 40.52%, followed by Healthcare at 12.33%. (Source: Ibid.)
Former high-flying NVIDIA Corp (NASDAQ:NVDA) was previously the top holding at 8.7% of the portfolio, but has since fallen out of the top 10 positions.
And while the top 10 holdings represent about 60.28% of the total, there are only three U.S.-listed stocks: Intuitive Surgical, Inc. (NASDAQ:ISRG), ABB Ltd (NYSE:ABBN), and John Bean Technologies Corp (NYSE:JBT). This allows investors to play good foreign companies in the robotics and AI space that you would otherwise not be invested in. (Source: Ibid.)
In my view, the Global X Robotics & Artificial Intelligence ETF is a viable strategy to partake in these growth areas.
Not only do you take some of the guesswork out and eliminate the single-stock risk, you get to benefit from a group of some of the top global companies in robotics and AI.
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