There's no doubt that artificial intelligence (AI) has been the hottest topic in technology (and perhaps all fields) over the past year and a half. AI is not a new development; many companies have been using it for years. From online shopping recommendations to voice assistants to self-driving technology, AI has been around for a while.
But recently, AI has gone mainstream thanks to the huge popularity of OpenAI's ChatGPT and other generative AI apps. Thanks to this popularity, many technology companies are going all-in on AI, and investors are rushing to invest in AI to capitalize on the momentum.
AI is a relatively broad field, with companies operating in different parts of the ecosystem. For investors looking to gain access to top companies across the AI space, Fidelity NASDAQ Composite Index ETF (NASDAQ:ONEQ) You can do the trick.
Cover many areas with one investment
of Nasdaq Composite is one of the three major stock market indexes in the United States and tracks all companies traded on the Nasdaq stock exchange. With many tech companies listed on the exchange, the Fidelity Nasdaq Composite Index ETF is dominated by tech stocks, with this sector accounting for nearly half (49.45%) of the fund. His four other sectors rounding out the top five are communications services (14.70%), consumption cycles (13.75%), healthcare (7.02%), and industrials (4.08%).
Even though tech companies are in the driver's seat, it's good to have some diversification (albeit a small amount) to avoid sector-specific volatility and downturns.
Some of the world's leading AI companies
The technology portion of the Fidelity NASDAQ Composite Index ETF includes some of the world's hottest and most important AI companies. Below is a snapshot of some of the ETF's top holdings (all in the top 10) and how they leverage AI.
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microsoft (NASDAQ: MSFT): A strategic partnership with OpenAI gives us exclusive rights to use and integrate their large-scale language models (LLMs) into our products.
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apple (NASDAQ:AAPL): In addition to current AI-powered features such as Siri, Apple plans to release an M4-powered Mac with a focus on AI features later this year.
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Nvidia (NASDAQ:NVDA): Leading developer of graphics processing units (GPUs) essential for machine learning and AI computations.
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Amazon (NASDAQ:AMZN): The e-commerce giant is using AI for personalized recommendations, warehouse logistics, and Alexa and Echo devices, as well as powering its cloud service Amazon Web Services.
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meta (NASDAQ:Meta): Leverage AI for targeted advertising, enhance user interactions on social media platforms, and invest in AI research to develop advanced machine learning models.
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alphabet (NASDAQ:GOOG)(NASDAQ:Google): Google's parent company is a leader in AI research and applications. We use AI in our search algorithms, ads, YouTube recommendations, self-driving cars with Waymo, and health initiatives with DeepMind.
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broadcom (NASDAQ:AVGO): Manufacturer of semiconductors, a critical component needed to run data centers on which AI training relies heavily.
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tesla (NASDAQ:TSLA): We are using AI extensively to develop self-driving technologies, including processing data from vehicle sensors to improve decision-making, safety features, and the overall development of self-driving cars.
It’s hard to argue with ETFs’ historical results.
The ETF includes a number of important AI companies, but the eight companies listed above make up more than half of the fund, and as these companies grow, so will the ETF. This has proven to be a good thing, as the Fidelity Nasdaq Composite Index ETF has significantly outperformed the S&P 500 over the past decade.
Of course, past performance is no guarantee of future performance, but when the world's top tech companies are leading the way, the Fidelity NASDAQ Composite Index ETF is well-positioned to take advantage of new technological innovations. You can be sure of that. Sector trends. This is a great way to get exposure to the hottest AI stocks.
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Alphabet executive Suzanne Frye is a member of The Motley Fool's board of directors. John Mackey, former CEO of Amazon subsidiary Whole Foods Market, is a member of the Motley Fool's board of directors. Randi Zuckerberg is a former head of market development and spokesperson at Facebook, sister of Meta Platforms CEO Mark Zuckerberg, and a member of the Motley Fool's board of directors. Stefon Walters has positions at his Apple and Microsoft. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool recommends Broadcom and recommends the following options: A long January 2026 $395 call on Microsoft and a short January 2026 $405 call on Microsoft. The Motley Fool has a disclosure policy.
Want to get exposure to the hottest AI stocks? Buy this ETF Handover Fist.Originally published by The Motley Fool
