Robotics, Automation & AI May Be One of the Most Important Investment Opportunities of Our Generation

 

The ROBO Global® Robotics & Automation Index returned an incredible 47% in 2017, significantly outperforming broad equity market indices.  The financial markets have made it clear that robotics, automation & AI (RAAI) may be one of the most important investment opportunities of our generation.

 

Even more impressive is that the multi-decade transition to a world dominated by RAAI technologies is still in its infancy—and the ingredients for a major breakthrough are already in place. Costs are rapidly declining across key enabling technologies such as computing, sensing, and communication, and an explosion in performance capabilities is dramatically expanding the scope of its application in nearly every industry.

 

The revolution is happening NOW!

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The index liquidity filter was modified in October 2014 and June 2017 as per the published index guidelines. The data shown is derived from the published index values. Data prior to 16 June 2014 is based on simulated back-tested data.

The time to invest is NOW

“It is difficult to predict—especially the future.”

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“It is difficult to predict—especially the future.” Those words from Danish physicist Niels Bohr fit the world of robotics, automation & AI perfectly. In the past decade, massive changes in technology, dramatic industry disruptions, and a flood of mergers and acquisitions have all come together to create an unprecedented and sustainable opportunity for investors.

Automation itself is nothing new. We have been automating the “dull, dirty, and dangerous” work of humans for decades. What’s different? The advent of machine intelligence has unleashed a massive and exponential wave of change. As a result, RAAI technologies are shifting the fundamental structure of every sector of the economy, altering the way we grow and process our food, how we manufacture and move goods of every kind, how we shop and play, and even how we learn and care for our health.

Investors who grasp this reality now—and build a diversified portfolio of industry leaders—will be well positioned to reap the rewards as these technologies continue to change the world around us.

But investors take note: not all “robo” funds are created equally. Yes, they may offer investors the opportunity to direct funds toward the RAAI revolution, but to future-proof any portfolio, strategy matters. Investing in today’s hottest large-cap stocks may seem like an investor’s dream come true, but it creates risk by ignoring RAAI’s unusually dynamic environment where the largest players change as quickly as the technologies themselves.

Instead, investors may opt to seek unique exposure to RAAI’s vast global value chain. Large-cap participants, yes, but also smaller providers of the enabling technologies that are driving industry growth. Sensing. Computing. Actuation. Application providers for factory automation, surgical robotics, food and agriculture, 3D printing, logistics automation, and more.

Acclaimed futurist Ray Kurzweil has said that, “Artificial intelligence will reach human levels by around 2029,” and that by 2045 “we will have multiplied the intelligence, the human biological machine intelligence of our civilization a billion-fold.” For the world, that’s quite a revolution. For investors, it may be an opportunity like nothing we’ve ever seen before.