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Jan. 30, 2021, 3:41 p.m. EST

Here’s what the robot fund that’s beating the S&P 500 is investing in now

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By Barbara Kollmeyer

A small struggle, led by technology, is shaping up for Tuesday, as a big earnings week is upon us and COVID-19 worries hover. One distraction right now — the war between short sellers and a group of stock enthusiasts behind GameStop /zigman2/quotes/203755179/composite GME -0.30% .

Shares of the videogame retailer are up 23% in premarket trading after Monday’s wild session . To some, this is stirring memories of the dot-com boom and bust, and fears history could repeat.

Maybe one day it will be easier, when the robots can do the thinking for us. That brings us to our call of the day , which comes from the DataTrek Research blog, who wonders whether a fund that relies on artificial intelligence for investing ideas and is heavy on tech stocks right now knows something we don’t.

DataTrek notes the AI Powered Equity /zigman2/quotes/204224847/composite AIEQ +0.02% exchange-traded fund is up 12% year to date, versus a 2.6% gain for the S&P 500 /zigman2/quotes/210599714/realtime SPX +0.75% , and for 2020 was up 25%, versus an 18% gain, respectively. It has gained 101% from the March COVID-19 pandemic lows, versus a 72% gain for the S&P.

Electric-car maker Tesla /zigman2/quotes/203558040/composite TSLA +3.02% , solar solutions group SunPower /zigman2/quotes/200243424/composite SPWR +0.18% , chip group Advanced Micro Devices /zigman2/quotes/208144392/composite AMD +0.12% , energy technology group Enphase Energy /zigman2/quotes/207948472/composite ENPH -0.49% , and tech giant Alphabet /zigman2/quotes/202490156/composite GOOGL +0.15% are the top five holdings.

What DataTrek found was the fund’s top picks are more tech heavy than last October, when more cyclical flavored stocks such as health care group Pfizer /zigman2/quotes/202877789/composite PFE -0.43% and automobile maker Ford /zigman2/quotes/208911460/composite F +1.62% made it into the top 10.

“AIEQ seems to have been picking up a good bit of market ‘signal’ in the last 12 months, so the fact that it is lightening up on cyclicals at the top of the sheet and maintaining/increasing its exposure to disruptive tech names (TSLA, SPWR, ENPH) is interesting,” says DataTrek.

What it could mean? A human manager backing away from cyclicals at the moment could be a sign of cold feet over the progress of the COVID-19 vaccine rollout.

As the DataTrek folks say, this AI ETF’s plays mirror those of a successful hedge-fund manager of the 1990s — “well-known stocks that play well-understood themes. Perhaps the real power of artificial intelligence-powered investing is simply not overthinking things too much.”

The markets

Stocks /zigman2/quotes/210598065/realtime DJIA +1.09% /zigman2/quotes/210599714/realtime SPX +0.75% /zigman2/quotes/210598365/realtime COMP +0.50% are flat, while European equities /zigman2/quotes/210599654/delayed XX:SXXP +0.74% are higher. China’s CSI 300 /zigman2/quotes/210598128/delayed XX:000300 +0.38% and Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +1.48% lost more than 2% each. That is after the People’s Bank of China, in a surprise move, pulled funds from the financial system and reportedly warned of asset bubble risks.

The tweet

From Alexis Ohanian, husband of tennis star Serena Williams and co-founder of Reddit:

The buzz

Reporting ahead of the market open, shares of conglomerate General Electric /zigman2/quotes/208495069/composite GE +1.63% are rising as revenue beat forecasts , and health care group Johnson & Johnson /zigman2/quotes/201724570/composite JNJ +0.74% posted a profit and growth in pharma sales. Financial services group American Express /zigman2/quotes/203805826/composite AXP +2.51% said revenue fell . After the close, tech giant Microsoft /zigman2/quotes/207732364/composite MSFT +0.48% , coffee group Starbucks /zigman2/quotes/207508890/composite SBUX -0.38% , and chip companies Advanced Micro Devices /zigman2/quotes/208144392/composite AMD +0.12% and Texas Instruments /zigman2/quotes/202237907/composite TXN +1.02% report.

Shares of e-commerce website Etsy /zigman2/quotes/202790087/composite ETSY +2.40% are up 9% in premarket. That move seems to have coincided with a comment on Twitter /zigman2/quotes/203180645/composite TWTR -0.63% by Tesla Chief Executive Elon Musk, who said “ I kinda love Etsy.

The Federal Housing Finance Agency house price index, the S&P Case-Shiller home price index, and consumer confidence data are all ahead.

/zigman2/quotes/203755179/composite
US : U.S.: NYSE
$ 183.28
-0.55 -0.30%
Volume: 1.20M
Oct. 15, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
$14.02 billion
Rev. per Employee
$424,150
loading...
/zigman2/quotes/204224847/composite
US : U.S.: NYSE Arca
$ 42.65
+0.0072 +0.02%
Volume: 10,337
Oct. 15, 2021 4:10p
loading...
/zigman2/quotes/210599714/realtime
US : S&P US
4,471.37
+33.11 +0.75%
Volume: 2.05B
Oct. 15, 2021 4:46p
loading...
/zigman2/quotes/203558040/composite
US : U.S.: Nasdaq
$ 843.03
+24.71 +3.02%
Volume: 18.92M
Oct. 15, 2021 4:00p
P/E Ratio
439.28
Dividend Yield
N/A
Market Cap
$834.61 billion
Rev. per Employee
$445,694
loading...
/zigman2/quotes/200243424/composite
US : U.S.: Nasdaq
$ 27.54
+0.05 +0.18%
Volume: 2.63M
Oct. 15, 2021 4:00p
P/E Ratio
11.52
Dividend Yield
N/A
Market Cap
$4.76 billion
Rev. per Employee
$511,286
loading...
/zigman2/quotes/208144392/composite
US : U.S.: Nasdaq
$ 112.12
+0.13 +0.12%
Volume: 34.20M
Oct. 15, 2021 4:00p
P/E Ratio
40.03
Dividend Yield
N/A
Market Cap
$136.00 billion
Rev. per Employee
$774,841
loading...
/zigman2/quotes/207948472/composite
US : U.S.: Nasdaq
$ 172.92
-0.86 -0.49%
Volume: 2.04M
Oct. 15, 2021 4:00p
P/E Ratio
135.85
Dividend Yield
N/A
Market Cap
$23.28 billion
Rev. per Employee
$911,088
loading...
/zigman2/quotes/202490156/composite
US : U.S.: Nasdaq
$ 2,827.36
+4.34 +0.15%
Volume: 1.51M
Oct. 15, 2021 4:00p
P/E Ratio
30.65
Dividend Yield
N/A
Market Cap
$1887.12 billion
Rev. per Employee
$1.35M
loading...
/zigman2/quotes/202877789/composite
US : U.S.: NYSE
$ 41.49
-0.18 -0.43%
Volume: 23.55M
Oct. 15, 2021 4:03p
P/E Ratio
17.76
Dividend Yield
3.76%
Market Cap
$232.62 billion
Rev. per Employee
$533,860
loading...
/zigman2/quotes/208911460/composite
US : U.S.: NYSE
$ 15.70
+0.25 +1.62%
Volume: 77.21M
Oct. 15, 2021 4:02p
P/E Ratio
18.12
Dividend Yield
0.00%
Market Cap
$62.72 billion
Rev. per Employee
$683,570
loading...
/zigman2/quotes/210598065/realtime
US : Dow Jones Global
35,294.76
+382.20 +1.09%
Volume: 327.87M
Oct. 15, 2021 4:46p
loading...
/zigman2/quotes/210599714/realtime
US : S&P US
4,471.37
+33.11 +0.75%
Volume: 2.05B
Oct. 15, 2021 4:46p
loading...
/zigman2/quotes/210598365/realtime
US : Nasdaq
14,897.34
+73.91 +0.50%
Volume: 4.09M
Oct. 15, 2021 5:16p
loading...
/zigman2/quotes/210599654/delayed
XX : STOXX
469.39
+3.47 +0.74%
Volume: 0.00
Oct. 15, 2021 11:03p
loading...
/zigman2/quotes/210598128/delayed
XX : China Securities Index
4,932.11
+18.50 +0.38%
Volume: 14.28B
Oct. 15, 2021 3:00p
loading...
/zigman2/quotes/210598030/delayed
HK : Hong Kong Exchange
25,330.96
+368.37 +1.48%
Volume: 2.35M
Oct. 15, 2021 4:08p
loading...
/zigman2/quotes/208495069/composite
US : U.S.: NYSE
$ 104.41
+1.67 +1.63%
Volume: 5.65M
Oct. 15, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
0.31%
Market Cap
$114.61 billion
Rev. per Employee
$459,155
loading...
/zigman2/quotes/201724570/composite
US : U.S.: NYSE
$ 161.30
+1.19 +0.74%
Volume: 6.92M
Oct. 15, 2021 4:00p
P/E Ratio
24.25
Dividend Yield
2.63%
Market Cap
$424.62 billion
Rev. per Employee
$613,918
loading...
/zigman2/quotes/203805826/composite
US : U.S.: NYSE
$ 175.81
+4.30 +2.51%
Volume: 3.04M
Oct. 15, 2021 4:02p
P/E Ratio
20.44
Dividend Yield
0.98%
Market Cap
$139.67 billion
Rev. per Employee
$599,451
loading...
/zigman2/quotes/207732364/composite
US : U.S.: Nasdaq
$ 304.21
+1.46 +0.48%
Volume: 25.38M
Oct. 15, 2021 4:00p
P/E Ratio
37.77
Dividend Yield
0.82%
Market Cap
$2283.98 billion
Rev. per Employee
$928,663
loading...
/zigman2/quotes/207508890/composite
US : U.S.: Nasdaq
$ 111.45
-0.42 -0.38%
Volume: 5.86M
Oct. 15, 2021 4:00p
P/E Ratio
46.67
Dividend Yield
1.76%
Market Cap
$131.41 billion
Rev. per Employee
$67,371
loading...
/zigman2/quotes/208144392/composite
US : U.S.: Nasdaq
$ 112.12
+0.13 +0.12%
Volume: 34.20M
Oct. 15, 2021 4:00p
P/E Ratio
40.03
Dividend Yield
N/A
Market Cap
$136.00 billion
Rev. per Employee
$774,841
loading...
/zigman2/quotes/202237907/composite
US : U.S.: Nasdaq
$ 194.45
+1.96 +1.02%
Volume: 2.65M
Oct. 15, 2021 4:00p
P/E Ratio
27.11
Dividend Yield
2.10%
Market Cap
$179.52 billion
Rev. per Employee
$482,033
loading...
/zigman2/quotes/202790087/composite
US : U.S.: Nasdaq
$ 221.09
+5.19 +2.40%
Volume: 1.39M
Oct. 15, 2021 4:00p
P/E Ratio
63.76
Dividend Yield
N/A
Market Cap
$27.98 billion
Rev. per Employee
$1.22M
loading...
/zigman2/quotes/203180645/composite
US : U.S.: NYSE
$ 62.77
-0.40 -0.63%
Volume: 6.69M
Oct. 15, 2021 4:02p
P/E Ratio
135.16
Dividend Yield
N/A
Market Cap
$50.09 billion
Rev. per Employee
$675,700
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