Need to Know Archives | Email alerts

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

new
Watchlist Relevance
LEARN MORE

Want to see how this story relates to your watchlist?

Just add items to create a watchlist now:

  • X
    GameStop Corp. Cl A (GME)
  • X
    AI Powered Equity ETF (AIEQ)
  • X
    S&P 500 Index (SPX)

or Cancel Already have a watchlist? Log In

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 +0.06% .

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 +1.50% exchange-traded fund is up 12% year to date, versus a 2.6% gain for the S&P 500 /zigman2/quotes/210599714/realtime SPX +0.74% , 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 +1.33% , solar solutions group SunPower /zigman2/quotes/200243424/composite SPWR +3.59% , chip group Advanced Micro Devices /zigman2/quotes/208144392/composite AMD +1.18% , energy technology group Enphase Energy /zigman2/quotes/207948472/composite ENPH +0.84% , and tech giant Alphabet /zigman2/quotes/202490156/composite GOOGL +0.62% 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 +1.00% and automobile maker Ford /zigman2/quotes/208911460/composite F +0.68% 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 +0.66% /zigman2/quotes/210599714/realtime SPX +0.74% /zigman2/quotes/210598365/realtime COMP +0.88% are flat, while European equities /zigman2/quotes/210599654/delayed XX:SXXP +0.89% are higher. China’s CSI 300 /zigman2/quotes/210598128/delayed XX:000300 -1.29% and Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI -0.09% 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 +0.68% are rising as revenue beat forecasts , and health care group Johnson & Johnson /zigman2/quotes/201724570/composite JNJ +0.45% posted a profit and growth in pharma sales. Financial services group American Express /zigman2/quotes/203805826/composite AXP +1.34% said revenue fell . After the close, tech giant Microsoft /zigman2/quotes/207732364/composite MSFT +1.09% , coffee group Starbucks /zigman2/quotes/207508890/composite SBUX -0.35% , and chip companies Advanced Micro Devices /zigman2/quotes/208144392/composite AMD +1.18% and Texas Instruments /zigman2/quotes/202237907/composite TXN +1.89% report.

Shares of e-commerce website Etsy /zigman2/quotes/202790087/composite ETSY +4.97% are up 9% in premarket. That move seems to have coincided with a comment on Twitter /zigman2/quotes/203180645/composite TWTR -0.04% 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
$ 161.11
+0.10 +0.06%
Volume: 2.93M
May 7, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
$11.40 billion
Rev. per Employee
$424,150
loading...
/zigman2/quotes/204224847/composite
US : U.S.: NYSE Arca
$ 37.78
+0.56 +1.50%
Volume: 12,201
May 7, 2021 4:10p
loading...
/zigman2/quotes/210599714/realtime
US : S&P US
4,232.60
+30.98 +0.74%
Volume: 2.05B
May 7, 2021 5:15p
loading...
/zigman2/quotes/203558040/composite
US : U.S.: Nasdaq
$ 672.37
+8.83 +1.33%
Volume: 23.47M
May 7, 2021 4:00p
P/E Ratio
672.98
Dividend Yield
N/A
Market Cap
$647.71 billion
Rev. per Employee
$445,694
loading...
/zigman2/quotes/200243424/composite
US : U.S.: Nasdaq
$ 23.37
+0.81 +3.59%
Volume: 3.15M
May 7, 2021 4:00p
P/E Ratio
9.79
Dividend Yield
N/A
Market Cap
$4.03 billion
Rev. per Employee
$511,286
loading...
/zigman2/quotes/208144392/composite
US : U.S.: Nasdaq
$ 78.81
+0.92 +1.18%
Volume: 36.95M
May 7, 2021 4:00p
P/E Ratio
33.50
Dividend Yield
N/A
Market Cap
$95.76 billion
Rev. per Employee
$774,841
loading...
/zigman2/quotes/207948472/composite
US : U.S.: Nasdaq
$ 122.96
+1.02 +0.84%
Volume: 3.43M
May 7, 2021 4:00p
P/E Ratio
198.96
Dividend Yield
N/A
Market Cap
$16.69 billion
Rev. per Employee
$911,088
loading...
/zigman2/quotes/202490156/composite
US : U.S.: Nasdaq
$ 2,351.93
+14.58 +0.62%
Volume: 1.44M
May 7, 2021 4:00p
P/E Ratio
31.31
Dividend Yield
N/A
Market Cap
$1591.31 billion
Rev. per Employee
$1.35M
loading...
/zigman2/quotes/202877789/composite
US : U.S.: NYSE
$ 39.58
+0.39 +1.00%
Volume: 33.81M
May 7, 2021 4:02p
P/E Ratio
23.15
Dividend Yield
3.94%
Market Cap
$220.78 billion
Rev. per Employee
$533,860
loading...
/zigman2/quotes/208911460/composite
US : U.S.: NYSE
$ 11.82
+0.08 +0.68%
Volume: 41.53M
May 7, 2021 4:04p
P/E Ratio
11.74
Dividend Yield
0.00%
Market Cap
$47.18 billion
Rev. per Employee
$683,570
loading...
/zigman2/quotes/210598065/realtime
US : Dow Jones Global
34,777.76
+229.23 +0.66%
Volume: 311.63M
May 7, 2021 5:15p
loading...
/zigman2/quotes/210599714/realtime
US : S&P US
4,232.60
+30.98 +0.74%
Volume: 2.05B
May 7, 2021 5:15p
loading...
/zigman2/quotes/210598365/realtime
US : Nasdaq
13,752.24
+119.39 +0.88%
Volume: 3.97M
May 7, 2021 5:16p
loading...
/zigman2/quotes/210599654/delayed
XX : STOXX
444.93
+3.91 +0.89%
Volume: 0.00
May 7, 2021 11:03p
loading...
/zigman2/quotes/210598128/delayed
XX : China Securities Index
4,996.05
-65.07 -1.29%
Volume: 17.23B
May 7, 2021 3:01p
loading...
/zigman2/quotes/210598030/delayed
HK : Hong Kong Exchange
28,610.65
-26.81 -0.09%
Volume: 2.21M
May 7, 2021 4:08p
loading...
/zigman2/quotes/208495069/composite
US : U.S.: NYSE
$ 13.30
+0.09 +0.68%
Volume: 53.88M
May 7, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
0.30%
Market Cap
$116.76 billion
Rev. per Employee
$459,155
loading...
/zigman2/quotes/201724570/composite
US : U.S.: NYSE
$ 168.50
+0.76 +0.45%
Volume: 5.32M
May 7, 2021 4:00p
P/E Ratio
29.76
Dividend Yield
2.52%
Market Cap
$443.73 billion
Rev. per Employee
$613,918
loading...
/zigman2/quotes/203805826/composite
US : U.S.: NYSE
$ 158.98
+2.10 +1.34%
Volume: 2.62M
May 7, 2021 4:03p
P/E Ratio
26.08
Dividend Yield
1.08%
Market Cap
$127.71 billion
Rev. per Employee
$599,451
loading...
/zigman2/quotes/207732364/composite
US : U.S.: Nasdaq
$ 252.46
+2.73 +1.09%
Volume: 27.03M
May 7, 2021 4:00p
P/E Ratio
34.36
Dividend Yield
0.89%
Market Cap
$1901.42 billion
Rev. per Employee
$877,393
loading...
/zigman2/quotes/207508890/composite
US : U.S.: Nasdaq
$ 114.34
-0.40 -0.35%
Volume: 4.87M
May 7, 2021 4:00p
P/E Ratio
136.95
Dividend Yield
1.57%
Market Cap
$134.73 billion
Rev. per Employee
$67,371
loading...
/zigman2/quotes/208144392/composite
US : U.S.: Nasdaq
$ 78.81
+0.92 +1.18%
Volume: 36.95M
May 7, 2021 4:00p
P/E Ratio
33.50
Dividend Yield
N/A
Market Cap
$95.76 billion
Rev. per Employee
$774,841
loading...
/zigman2/quotes/202237907/composite
US : U.S.: Nasdaq
$ 187.76
+3.49 +1.89%
Volume: 4.59M
May 7, 2021 4:00p
P/E Ratio
28.45
Dividend Yield
2.17%
Market Cap
$173.40 billion
Rev. per Employee
$482,033
loading...
/zigman2/quotes/202790087/composite
US : U.S.: Nasdaq
$ 165.51
+7.83 +4.97%
Volume: 5.86M
May 7, 2021 4:00p
P/E Ratio
46.87
Dividend Yield
N/A
Market Cap
$21.04 billion
Rev. per Employee
$1.22M
loading...
/zigman2/quotes/203180645/composite
US : U.S.: NYSE
$ 53.79
-0.02 -0.04%
Volume: 21.75M
May 7, 2021 4:03p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$42.93 billion
Rev. per Employee
$675,700
loading...
1 2
This Story has 0 Comments
Be the first to comment
More News In
Markets

Story Conversation

Commenting FAQs »

Partner Center

World News from MarketWatch

Link to MarketWatch's Slice.