The Global X Artificial Intelligence and Technology ETF has become one of the most watched funds on Wall Street, riding the powerful wave of investor demand for artificial intelligence. With a track record of beating the broader market since its launch, the ETF offers exposure to some of the biggest names in tech. But questions remain about whether its diverse approach can keep pace with leaner, more focused rivals.
AI ETF Delivers Strong Market-Beating Returns
The Global X Artificial Intelligence and Technology ETF, known by its ticker AIQ, was launched in May 2018. Since then, it has surged more than 225 percent, outperforming the S&P 500’s 144 percent and even the tech-heavy Nasdaq’s 205 percent gain in the same period.
This performance has cemented AIQ’s status as a leading way to capture the AI boom without betting on just one stock.
Trading recently around $49 per share, AIQ remains close to its record high of $49.84 set earlier this year. Year to date, it has continued to edge higher, supported by strong earnings across the tech sector and sustained demand for AI-related infrastructure.
What the AIQ ETF Holds
AIQ is not a pure-play fund on artificial intelligence but a broad collection of 88 stocks with ties to the sector. Its top five holdings together make up 17.5 percent of the portfolio and include Alibaba, Alphabet, Tesla, Oracle, and Broadcom.
The fund’s sector weightings reveal a heavy tilt toward information technology, which makes up 70.6 percent of assets. Within that, software and services stocks dominate at 37.6 percent, while semiconductor companies account for 20.5 percent. Hardware equipment stocks add another 12.5 percent.
The remaining 29.4 percent is spread across industries not always thought of as AI-driven, such as consumer discretionary, financial services, healthcare equipment, and transportation. This wider scope highlights AIQ’s philosophy that artificial intelligence cuts across industries and borders.
| AIQ Portfolio Breakdown | Percentage |
|---|---|
| Software & Services | 37.6% |
| Semiconductors | 20.5% |
| Hardware Equipment | 12.5% |
| Other Industries | 29.4% |
Expense Ratio and Valuation
AIQ currently manages about $5.26 billion in assets. The fund charges an expense ratio of 0.68 percent, slightly above the median of 0.56 percent for actively managed ETFs. While higher costs can eat into returns over time, AIQ’s performance has so far offset this concern.
On valuation, the ETF trades at 25.5 times trailing earnings. That compares favorably with the S&P 500’s multiple of 30.8 and the Nasdaq’s 32.9, suggesting AIQ may not be overextended despite its strong run. Its price also remains closely aligned with its net asset value, signaling healthy trading demand.
How AIQ Stacks Against QQQ
One of AIQ’s biggest challenges is competition from the Invesco QQQ Trust, the popular ETF that tracks the Nasdaq-100 index. Since AIQ’s debut, QQQ has climbed 252 percent, outpacing AIQ’s 225 percent.
QQQ is cheaper to own, with an expense ratio of just 0.2 percent, and is passively managed. Its top holdings — Nvidia, Microsoft, Amazon, Apple, and Broadcom — are some of the strongest beneficiaries of the AI revolution. Unlike AIQ, QQQ avoids spreading exposure into slower-growth industries, keeping its focus on the highest-growth technology leaders.
This difference means QQQ often rides the market’s fastest-moving trends more aggressively, while AIQ provides broader but sometimes less dynamic coverage.
Should Investors Still Bet on AIQ?
For investors seeking diversified exposure to the AI megatrend without picking individual winners, AIQ offers a balanced approach. It spreads risk across industries and geographies while still keeping most of its weight in technology. That makes it appealing for those who believe AI will transform multiple sectors in the long run.
However, its higher fees and slower pace compared to QQQ raise questions about opportunity cost. Investors who want sharper exposure to the top-performing AI names may prefer QQQ, while those looking for stability and breadth may find AIQ a better fit.
AIQ’s ability to hold its edge will depend on whether its diverse lineup of companies outside of core tech can deliver AI-driven growth in the years ahead.
The debate over AIQ versus QQQ reflects a broader choice for investors today: chase concentrated bets on the hottest players, or spread the risk across a wider net of potential winners. As artificial intelligence continues to reshape industries, both strategies will remain in sharp focus.
The heart of the story is that AIQ has beaten the market since 2018, but it still lags behind its closest rival QQQ, raising a tough choice for investors deciding where to place their money.
In the end, AIQ stands as a proven way to ride the AI wave, but whether it remains the best way forward will depend on how the next stage of the AI race unfolds.
