Artificial intelligence is rapidly gaining importance. Its economic potential is huge. But if you want to benefit from it when investing, you should avoid unnecessary risks.
157 billion dollars: quite a lot for a company that is still making losses. But that's how high the valuation of OpenAI, the creator of ChatGPT, is. At least if you extrapolate from the most recent funding round by investors. Through that round, OpenAI is receiving a capital injection of 6.6 billion dollars.
The economic potential of artificial intelligence (AI) has a magnetic pull on investors. And that's no accident. According to a recent survey, almost 40 percent of people between 18 and 64 in the US now use generative AI like ChatGPT. For comparison: the PC took three years to reach an adoption rate of 20 percent. The internet reached 20 percent after two years.
The appeal is quickly explained. After a brief „prompt“, generative AI produces texts, images or videos in a matter of seconds, for example. The potential applications of the technology are extremely diverse. If you want to try out what generative AI can do in financial advice, for instance: Q.Ai, the new AI bot from Quirin Privatbank and quirion, shows you.
Higher productivity
73 percent of German companies see AI as the most important technology of the future, as the digital association bitkom found in a survey. And the McKinsey Global Institute estimates that the use of generative AI could lead to annual productivity gains of up to 4.4 trillion US dollars worldwide. That would be more than the annual economic output of France or the United Kingdom.
But before this potential can unfold, a great deal has to be invested first. For expanding capacity in chip production, for example, building data centres, optimising the AI, or developing applications for companies across the most varied industries. Many billions are being raised for this - in the US last year, 67 billion US dollars in private investment alone.
A dream profit margin
A lot of money is therefore already being made with AI today. At Nvidia, for example, the chip developer and the stock market's flagship company of the AI industry. In the second quarter, Nvidia had achieved earnings before interest and taxes of 19.9 billion dollars. And for the third quarter, it forecast a gross margin of 75 percent. The vast majority of companies can only dream of a margin like that.
Even so, the share initially fell after the figures were published. The price already reflected extremely high expectations. And the more ambitious the expectations baked into the price, the more likely a share is to head downward even on news that's actually positive.
Expectations are directed at the future. No one can know yet which of them will be met and which companies will turn out to be the winners of the AI boom. But there is a proven way to guard against such uncertainties: through diversification, investors reduce the risks compared with investing in individual shares.
Investing in megatrends, bundled together
How do you invest in a way that takes risks appropriately into account? Which investment theme really has a future? Questions like these were central to putting together our Megatrends portfolio. Artificial intelligence is one of five themes in this portfolio, which invests via ETFs in numerous companies from various sectors of the economy and different countries. The portfolio is something for those who want to set their own priorities in their portfolio beyond a core investment.
In addition to the Megatrends portfolio, we also offer 12 ETF portfolios on individual themes - including „Artificial intelligence“. All the thematic portfolios contain 100% equity ETFs. During the application process, we check which form of investment matches your personal risk appetite and your individual investment horizon.
Because thematic investments are always riskier than investing in a portfolio diversified according to scientific criteria, such as our global ETF portfolio. That portfolio is entirely designed to bring return opportunities and risks into the best possible balance. The global ETF portfolio, via ETFs, gives you a stake in around 8,000 shares, including some from the AI segment. So with this portfolio, investors also benefit from the future theme of AI.
