Seeking Alpha
2023-02-01 13:33:12

Cathie Wood's 'Big Ideas 2023' sees Artificial Intelligence as the future

Cathie Wood and Ark Invest are bullish on the future of artificial intelligence. The high-profile innovation-focused investor highlighted the importance AI and the convergence of technology platforms in a “Big Ideas 2023” investor report. Wood and her team outlined that market participants should be looking at five converging innovation platforms that have the ability to “define this technological era.” At the center is artificial intelligence, with robotics, multiomic sequencing, public blockchains and energy storage orbiting nearby. ARK believes that these technologies can together provide exponential growth into the future of the global economy. The firm predicated that AI training cost reductions continued at an annual rate of 70%. To put that into perspective, the cost to train a large language model to GPT-3 level performance dropped to $450,000 in 2022 after being near $4.6 million in 2020, ARK noted. “We expect cost declines to continue at a 70% rate through 2030.” See a below graphic on the projected declining cost of AI, according to ARK. Wood stated: “We've been working on artificial intelligence for a long time now, and I think some of the things we're seeing are just the beginning of the impact that artificial intelligence is going to have on every sector, every industry, and every company.” Wood’s 2023 big ideas report added: “The market value of disruptive innovation platforms could scale 40% at an annual rate during this business cycle, from $13 trillion today to $200 trillion by 2030. In 2030, the market value associated with disruptive innovation could account for the majority of the global equity market capitalization.” While Wood didn't offer specific stock picks, potential AI stocks include names like ( AI ), as well as firms providing the technology backbone for advancements in the space, like Nvidia ( NVDA ) and Ambarella ( AMBA ). Meanwhile, many of the big tech names are deep into AI as well. This includes Microsoft ( MSFT ), Alphabet ( GOOG ) ( GOOGL ), Apple ( AAPL ) and IBM ( IBM ). Other big ideas for 2023 that Wood and her team are focusing on include digital consumers, digital wallets, Bitcoin ( BTC-USD ), smart contract networks, precision therapies, electric vehicles, autonomous ride-hail and orbital aerospace. Here are Wood's actively managed ETFs: ARK Innovation ETF ( NYSEARCA: ARKK ) ARK Next Generation Internet ETF ( NYSEARCA: ARKW ) ARK Autonomous Technology & Robotics ETF ( BATS: ARKQ ) ARK Genomic Revolution ETF ( BATS: ARKG ) ARK Fintech Innovation ETF ( ARKF ) ARK Space Exploration & Innovation ETF ( ARKX ) In other artificial intelligence related news, see the AI-driven exchange traded fund that doubled the returns of the S&P 500 in January.

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