iShares Brings Active AI To Its ETFs

World’s largest issuer launches seven nontraditional active sector ETFs driven by artificial intelligence.

ETF.com
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Reviewed by: etf.com Staff
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Edited by: etf.com Staff

Today, BlackRock’s iShares unit has rolled out seven ETFs that represent a groundbreaking departure for the iconic firm, and indeed the ETF industry as a whole.

The “Evolved” ETFs are actively managed sector funds, for one thing, but they also encompass nontraditional sectors driven by artificial intelligence. The new funds include:

Each comes with an expense ratio of 0.18% and lists on Cboe Global Markets, the parent company of ETF.com.

Innovative Approach To Sectors

The funds draw their components from the large-cap, midcap and small-cap segments, and rely on data analysis tools that are pillars of artificial intelligence technology, including machine learning, natural language processing and clustering algorithms, among others. These tools ensure the strategies keep up with changing markets and find the ties between companies potentially operating in these different sectors under the radar.

The sectors are determined by algorithms, as well as artificial intelligence that relies on publicly available data for the companies falling into the different categories. The Evolved sector classification system currently cover 12 markets; beyond the seven targeted by the newly launched funds, the list includes energy, industrials, real estate, telecommunications and utilities.

Perhaps most interesting about the Evolved sector structure is the fact that one company can fall into multiple sectors. The prospectuses note that the fact a company can belong to multiple sectors reflects the multidimensional nature of certain companies, and the sector classifications may evolve over time.

The Evolved funds will invest in companies that have similar drivers to those that have traditionally fallen into their respective sectors. The iShares family is the first to cover a full suite of actively managed sector funds, and the first family of sector ETFs to be driven by artificial intelligence.

Contact Heather Bell at [email protected]

 

 

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