Diversification Needed to Capitalize on AI Investing Opportunities

Ask investors, likely both professional and retail, what individual stock they most readily associated with artificial intelligence (AI). Chances are the bulk of those queried will reply with "semiconductor giant Nvidia (NVDA)."

That’s a reasonable response, particularly when considering Nvidia’s dominant positioning in AI computing. Nvidia also explains why ETFs, including the Invesco QQQ Trust (QQQ) and the Invesco NASDAQ 100 ETF (QQQM), with large weights to the stock have thrived.

Speaking of ETFs with AI ties, of which QQQ and QQQQM fit the bill, those investment products could be increasingly relevant at a time when some market observers believe investors should look beyond Nvidia and embrace diversification as an avenue for best capitalizing on the long-term potential of the AI investment thesis.

QQQ, QQQM Have AI Diversification

QQQ and QQQM, which have the same rosters, allocate 6.34% of their weights to Nvidia. That company is that the ETFs’ third-largest holding from the technology sector. But there’s much more to the funds’ AI stories. And that’s a positive for long-term investors.

“However, to build long-term, sustainable wealth, investors should diversify their AI investments beyond Nvidia and explore opportunities in emerging players and niche segments of the market,” noted deVere Group CEO Nigel Green.