iShares Debuts Robotics/AI ETF

Today BlackRock’s iShares arm rolled out an ETF targeting the robotics and artificial intelligence space. The iShares Robotics and Artificial Intelligence ETF (IRBO) joins a number of other similar products.

The fund comes with an expense ratio of 0.47% and lists on the NYSE Arca. That price significantly undercuts the two leading robotics ETFs, which both have more than $2 billion in assets. The Global X Robotics & Artificial Intelligence ETF (BOTZ) charges 0.68%, while the ROBO Global Robotics and Automation Index ETF (ROBO) charges 0.95%.

Methodology

IRBO tracks an index provided by NYSE that selects stocks from 43 developed and emerging markets, with the focus mainly on companies operating in the semiconductor, software, internet and data services industries.

Based on publicly available information, the index targets companies that generate at least half of their revenues from 22 robotics- and AI-related subindustries, as well as those that hold at least a 20% market share or generate at least $1 billion in annual revenues in those industries. Components are equally weighted within the index, the prospectus says.

To be eligible for inclusion, companies must have a free-float-adjusted market cap of at least $500 million and meet liquidity requirements. As of early May, 90 companies representing 11 countries were included in the index underlying IRBO, according to the fund documentation. That’s comparable to the 87 held by ROBO, but far more than the 28 held by BOTZ.

Contact Heather Bell at [email protected]