How to invest in robotics? A careful selection of ETFs that invest in this theme with characteristics, costs, and replication methods.
Robotics is undoubtedly one of the most fascinating and rapidly growing sectors of the modern technological landscape. Since the beginning of the year, this sector has captured the attention of investors and technology enthusiasts around the world.
The combination of artificial intelligence, advanced automation, and robotics is transforming multiple sectors, from manufacturing to healthcare, from logistics to entertainment.
In this article, we will take a closer look at this growing trend, highlighting a selection of ETFs (Exchange-Traded Funds) that offer unique access and diversify to the world of robotics. We will discover the key characteristics of these investment tools and evaluate the opportunities that the robotics sector offers for the rest of the year.
Robotics, a rapidly growing market
The robotics market, a fascinating universe spanning the design, development, manufacturing, and implementation of systems and technologies, represents a driving force in the industrial, healthcare, agricultural, logistics, defense, and entertainment sectors. This revolutionary sphere is characterized by highly sophisticated machines capable of carrying out tasks autonomously or with minimal human involvement, imitating human actions or carrying out specialized tasks.
In the current landscape, service robotics is the undisputed protagonist, with a forecast of market volume of 28.49 billion dollars by 2023 (source: Statista). This underlines the growing use of robots to improve the efficiency and quality of services in various industries. Furthermore, the entire industry is experiencing steady growth, with a projected annual growth rate (CAGR 2023-2028) of 3.83%, projecting a market volume of $45.09 billion by 2028.
In the United States, in particular, significant influence is observed, with revenue forecasts of $7.722 billion in 2023. This underlines its leadership position in the innovation and adoption of cutting-edge robotic technologies, as well as the important role they play in the continued growth of this rapidly evolving industry.
iShares Automation & Robotics UCITS ETF
The iShares Automation & Robotics UCITS ETF is a solid proposition for investors interested in exposure to the automation and robotics sector. This ETF offers an efficient and cost-effective way to participate in the growth of automation-related technologies in developed and emerging markets.
One of the strengths of this ETF is its low total expense ratio (TER) of 0.40% per annum, which positions it as one of the most affordable ETFs available for the sector. Furthermore, as the largest fund that tracks the iSTOXX® FactSet Automation & Robotics Index, it offers exceptional liquidity and large assets under management of €2,847 million, which can provide investors with greater peace of mind.
The ETF replicates the performance of the underlying index through a sampling strategy, investing in a targeted manner in the most important components. Additionally, the dividends generated by the fund are accumulated and reinvested, which could be beneficial for long-term investors.
Performance data indicates notable growth over the years, with positive returns, including a YTD return of +19.89% and a significant increase of +82.62% over the past five years. However, it is important to note that this sector can be subject to volatility, as evidenced by the 1-year annual volatility of 18.76%.
Despite the volatility, the iShares Automation & Robotics UCITS ETF appears to offer a solid balance between risk and reward, with positive overall performance over time. Investors interested in participating in the growth of the automation and robotics sector may find this ETF an attractive and convenient solution.
L&G ROBO Global Robotics and Automation UCITS ETF
The L&G ROBO Global Robotics and Automation UCITS ETF is a financial product that offers an interesting opportunity for investors interested in the robotics and automation sector. This ETF tracks the ROBO-STOX® Global Robotics and Automation Index, which tracks stocks related to this sector from around the world.
A key feature of this ETF is its full physical replication strategy, which involves purchasing all components of the underlying index. This means investors get complete sector coverage, which can be beneficial for those looking for broad diversification. However, it is important to note that the TER (annual expense ratio) is 0.80%, which can be considered relatively high compared to other ETFs.
The ETF accumulates and reinvests dividends, offering a potential long-term benefit for investors. With assets under management of €803 million, the L&G ROBO Global Robotics and Automation UCITS ETF is a significantly sized product, which may offer greater stability.
The ETF’s historical performance is solid, with positive returns over time. However, it is important to note that the robotics and automation sector can be subject to some volatility, as evidenced by the 1-year annual volatility of 17.32%. Investors should carefully consider their time horizon and risk level before investing in this ETF.
In summary, the L&G ROBO Global Robotics and Automation UCITS ETF offers an attractive investment solution for those looking to expose their portfolio to the rapidly growing robotics and automation sector. However, investors should be aware of the relatively high TER and potential volatility associated with the sector.
Amundi MSCI Robotics & AI ESG Screened UCITS ETF
The Amundi MSCI Robotics & AI ESG Screened UCITS ETF represents an attractive investment opportunity for those looking to combine exposure to the robotics and artificial intelligence sectors with an ESG (environmental) footprint, social and corporate governance) responsible. This ETF tracks the MSCI ACWI IMI Robotics & AI ESG Filtered Index, which is composed of global companies from developed and emerging nations involved in, or benefiting from, the development of AI and robotics.
A key feature that sets this ETF apart is its low annual expense ratio (TER) of 0.35%, placing it among the most affordable options for investors interested in this sector. Furthermore, the fact that it is the only ETF to replicate the MSCI ACWI IMI Robotics & AI ESG Filtered index offers investors a unique possibility to access this specific index.
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The ETF adopts a full physical replication strategy, investing in all components of the underlying index. This approach can provide comprehensive coverage and broad diversification in the AI and robotics industry.
Having dividends accumulated and reinvested in the ETF can be beneficial to long-term investors, allowing them to benefit from compound growth. With assets under management of 785 million Euro, this ETF is of significant size.
The ETF’s historical performance is strong, with positive returns over several time horizons, including a YTD return of +16.65% and a notable increase of +75.32% over five years. While the sector can be subject to volatility, the 1-year annual volatility of 15.93% is relatively low.
In conclusion, the Amundi MSCI Robotics & AI ESG Screened UCITS ETF offers an attractive investment opportunity for those seeking exposure to the robotics and AI sector with a responsible ESG footprint. The low TER, diversification, and positive historical performance make it a worthy option for investors interested in this growth sector.
| Disclaimer The information and considerations contained in this article should not be used as the sole and principal basis on which to make investment decisions. The reader retains full freedom in his own investment choices and full responsibility in making them since he alone knows his risk appetite and his time horizon. The information contained in the article is provided for informational purposes only and its disclosure does not constitute and should not be considered an offer or solicitation for public savings. |
Original article published on Money.it Italy 2023-10-19 08:41:00. Original title: Come investire nella robotica? Gli ETF migliori
