How Do I Choose an AI ETF for Diversified AI Exposure?

Name: How Do I Choose an AI ETF for Diversified AI Exposure?
Uploaded: 2026-08-20T16:50:05.000Z
Duration: 4 min 48 s
Channel: iShares by BlackRock

iShares by BlackRockAugust 20, 20264m

Topics6

Choosing an AI ETF for Diversified Exposure0:00 The AI Stack Framework0:31 Determining Which AI ETF Is Right1:30 AI's Physical Demands and Adjacent Themes2:01 Three Things to Review When Choosing an AI ETF2:30 Key Takeaways4:00

In a Nutshell

Choose an AI ETF by first deciding which layer of the AI stack you want exposure to—broad value-chain funds such as ARTY or BAI cover infrastructure, models, and applications, while narrower products like SOXX or POWR isolate chips or power demand. Review each ETF’s holdings and concentration levels, then map them against existing positions in broad tech (IYW) or S&P 500 (IVV) funds to confirm the new ETF adds complementary exposure rather than overlap.

AI-Generated Notes

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The answer depends on which part of the AI opportunity investors want to own because an AI fund can mean very different types of exposure. Some funds go broad, others go narrow, and others invest across the entire AI ecosystem or value chain. Understanding those differences is one of the most important steps when choosing an AI ETF. AI exposure isn't a one-size-fits-all.

When investors say they're looking for an AI ETF, they could be talking about several different investment approaches. One way to understand those differences is to think about what we call the AI stack.

AI is unfolding in three phases: the build-out phase, the adoption phase, and the transformation phase, and that creates opportunities across different layers of the AI stack. The AI stack consists of three layers:

Infrastructure at the foundation
Intelligence in the middle
Applications and services at the top

At the foundation are things like data centers, cloud infrastructure, and computing hardware that powers AI. In the middle is the intelligence that makes AI work. At the top are the applications and the services that bring AI to consumers and businesses.

You can think of it like a layered cake. Each layer plays a different role, and together they make the broader AI ecosystem possible. Different funds can give exposure to different parts of the stack or across the broader AI value chain.

To determine which AI ETF is right, ask "What type of AI exposure am I looking for?" One approach is to invest across the entire AI value chain, from software and models through to the data, chips and infrastructure. Funds designed around the AI value chain opportunity include the iShares Future AI and Tech ETF (ARTY) and the actively managed iShares AI Innovation and Tech Active ETF (BAI).

If you're excited about one particular part of the value chain, like semiconductors, you can buy more precise exposure to just those names through a semiconductor ETF like SOXX.

A second approach is to look at themes benefiting from AI's growing physical demands. AI requires significant amounts of electricity and infrastructure. That can create opportunities in areas such as power infrastructure. Funds like POWR provide more targeted exposure to some of those adjacent themes.

Other funds, like the iShares NASDAQ 100 ETF (IQQ), may provide broader technology exposure where AI leaders are just one part of a much larger innovation portfolio. That's why it's important to look beyond the label and understand what a fund actually owns.

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How Do I Choose an AI ETF for Diversified AI Exposure?

Choosing an AI ETF for Diversified Exposure00:00

The AI Stack Framework00:31

Determining Which AI ETF Is Right01:30

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