Amid the ChatGPT Craze... "AI ETF Investment Funds Expected to Reach 46 Trillion Won by 2030"

Bloomberg Economic Research Institute Forecast
"AI ETF Assets Under Management to Triple by 2030"

The hype around generative artificial intelligence (AI), represented by 'ChatGPT,' is expected to expand the assets under management of global AI exchange-traded funds (ETFs) to $35 billion (approximately 46.5 trillion KRW) by 2030.

On the 29th, Bloomberg News cited a report from its economic research division, Bloomberg Intelligence (BI), stating that the assets under management of ETFs tracking AI-related companies are expected to more than triple by 2030 compared to current levels.

The report projected that the number of ETFs tracking AI companies could increase globally from the current 56 to over 150. It especially anticipated a large influx of investor funds into China, which is nationally committed to fostering AI. Currently, there are three ETFs in China focusing on robotics investment, with assets totaling only $67 million (approximately 89 billion KRW).

[Image source=Reuters Yonhap News]

Interest in AI surged after the release of OpenAI's ChatGPT last year. The ChatGPT craze has also driven investment funds toward AI-related stocks. Nvidia, which holds around a 90% market share in the AI semiconductor market, saw its stock price soar 24% in a single day on the 25th (local time), bringing its market capitalization close to the $1 trillion mark. The stock price surged after a forecast that second-quarter sales would exceed Wall Street expectations by more than 50%, reaching $11 billion, driven by a sharp increase in demand for AI semiconductors. Wall Street has raised Nvidia's target price from the current $379.80 to $500, indicating potential for more than a 30% additional increase in the stock price.

U.S. ETF investors are also shifting funds from ETFs that include some AI-related stocks to ETFs that focus exclusively on AI companies. According to Bloomberg, there are about 12 ETFs with AI mentioned in their fund descriptions, from which $339 million (approximately 451 billion KRW) has been withdrawn this year. Nearly half of this amount, $2 billion (approximately 2.66 trillion KRW), has flowed into the U.S.'s largest AI-focused fund, the 'Global X Robotics & AI' ETF.

Bloomberg Intelligence stated, "With the growth of AI and ChatGPT, and companies like Nvidia absorbing technology demand, AI ETFs are expected to expand further," adding, "AI ETFs are projected to continue trending upward in terms of both momentum and performance."