XT ETF

The iShares Exponential Technologies ETF is a great way for conservative investors to add higher-octane equity exposure to their portfolios. XT has exhibited relatively low downside risk compared to other risk-seeking investments and offers diversification with over 200 holdings. The ETF focuses on technology stocks, which have shown significant growth potential over the past five years.

iShares Exponential Technologies ETF is a hold due to multiple risk factors outweighing its returns along with a relatively high expense ratio. XT lacks holdings with strong fundamentals and diversified revenue streams compared to peer tech funds, particularly Vanguard's VGT. XT also includes foreign tech holdings in emerging markets, representing geopolitical risks.

iShares Exponential Technologies ETF offers exposure to companies driving technological advances across various sectors globally. The XT ETF provides diversification with over 190 holdings, minimizing specific company risk. The fund invests in both developed and emerging markets, potentially benefiting from global growth trends.

XT invests in companies recognized as innovators, capitalizing on disruptive technologies. The rules-based strategy has lagged behind passively indexed equity benchmarks. We are bullish on stocks but do not recommend the XT ETF.

XT has a fair bit of AI exposure, through semiconductor and software companies, that has been driving its returns ahead of a typically weighted US index. We think that longer-term, the AI hype is overdone and generative AI won't make quite the dislocating impact that some expect. Still, everyone is going to chase it, because all businesses need to pay the premium for the AI business option.