Evolve Funds Group, a Toronto-based asset manager with $7.2 billion in assets under management, has launched its first artificial intelligence exchange-traded fund that uses generative AI in order to give investors exposure to AI companies.
Evolve Artificial Intelligence Fund, or ARTI on the Toronto Stock Exchange, is powered by the generative AI platform Boosted.ai and purports to be the first Canadian ETF that uses generative AI to find the best companies that are likely to benefit from the AI renaissance.
“As a leader in disruptive technology ETFs, Evolve has been exploring a pure play AI ETF for the last several years,” Raj Lala, chief executive officer at Evolve ETFs, said in a statement announcing the company had filed its final prospectus on Thursday. “Boosted.ai’s proprietary model uses generative AI to seek to identify the best AI companies fundamentally changing our world. “
The fund is actively managed, with a person overseeing the generative AI’s selections.
Boosted.ai has its own proprietary large language model that uses an algorithm to determine a company’s chances of benefiting from increased global adoption of AI. It analyzes “securities of issuers from developed markets that are directly involved in the development of AI, including related technologies and services and those whose business models or operational efficiencies may be significantly enhanced by AI integration,” according to a press release announcing the launch of the fund today.
Artificial intelligence is not new to wealth management; almost all advisors have said that their firms have taken steps to implement AI strategies. A recent trend report by wealthtech consulting firm F2 Strategy found that 51 percent of firms are currently working on AI projects.
A new Mercer survey of 150 asset managers found that 91 percent of managers either use or plan to use AI in their investment strategy or asset research; 21 percent of managers that use AI said they will launch an AI-related investment strategy in the next year.
“AI is currently being applied differently across asset classes,” Joanne Holden, global head of investment research and consulting at Mercer Investments, said in an emailed statement to RIA Intel. “We are mainly seeing investment managers applying AI to augment existing capabilities, but there is opportunity to deploy AI in more complex aspects of portfolio management, such as portfolio construction and rebalancing. This step from applying AI to drive efficiencies to the implementation of more complex aspects of investment management will be key to AI becoming truly transformative.”
