Many people are currently talking about AI and the impact of this pending revolution on our lives, so what does the abbreviation stand for? Artificial intelligence.
It is hard to know what the future is going to look like, just the other day I made a reference to AI taking away all the menial tasks and someone said to me, “Yes but individuals will still have to go out and pick fruit and vegetables”, but will they? There is no reason why these can’t be picked by robots in the future.
The growth can be seen by looking at Tech’s share of the S&P 500 (a stock market index tracking the stock performance of 500 of the largest companies listed on stock exchanges in the United States). They grew from just 6% in 1992 to 19% in 1998 and 30% in 1999.*1 As one of 11 sectors that make up the S&P 500, the tech industry currently accounts for more than a quarter of the stock indexes value.*2
The speed at which we are now embracing new technology is also interesting. It took Netflix nearly 3.5 years to get a million subscribers, but ChatGPT hit 1 million users in 5 days.*3
So if an individual wanted to invest in this sector how could they go about it?
Well, they could invest in an individual company by buying some shares or they could invest in a unit trust that specialises in that sector, giving them holdings in more than one company so that their risk is spread. They don’t necessarily have to be invested in a specialist unit trust to have holdings in tech companies, and often a fund fact sheet will tell you what the top ten holdings of a fund are.
So if you would like to find out more and the potential risks involved why not pick up a phone today and book a free without obligation consultation.
*1 Forbes, 6th March 2000
*2 Google, July 2023
*3 Indian Express, 20231