The link between artificial intelligence and investment opportunities can be understood through three types of companies: enablers, enhancers, and end users.
In practice, Janus Detroit Street Trust, a statutory investment trust, uses these three categories to analyze and execute investments.
Artificial intelligence (AI) is understood as computerized systems capable of acting and reacting as if they had intelligence. This concept encompasses different technologies and methodologies. It includes, for example, natural language processing, facial recognition, and robotics.
The term AI has been around for decades. It was coined in the 1950s. Since then, the field has gone through periods of great progress and stages of stagnation.
Artificial intelligence and investment opportunities
Artificial intelligence is defined as the ability of a machine to perform tasks that previously depended only on humans. It includes learning, reasoning, problem solving, perception, and language comprehension.
Technologies based on machine learning and large volumes of data make it possible to simulate reasoning processes at an almost human level. For this reason, they are often considered artificial intelligence.
This field has advanced rapidly. It has gone from simple automation to the imitation of complex cognitive functions. As a result, technological innovation is accelerating and disruption is reaching all sectors.
In this context, portfolio management classifies companies linked to artificial intelligence into three groups. There are the enablers, which provide the infrastructure. Then there are the enhancers, which optimize the technology. Finally, there are the end users, who apply AI to improve their performance.
These categories are not static. In fact, they can be adjusted over time to incorporate new developments as artificial intelligence evolves.
Facilitators
These companies provide the technological hardware and infrastructure essential for training and implementing artificial intelligence.
Enhancers
These companies optimize or refine artificial intelligence technology to improve functionality, performance, integration, or usability for practical application.
End Users
This category includes companies that incorporate and apply artificial intelligence technologies to optimize their operations and improve overall business performance.
Investment portfolio
According to Janus Detroit Street Trust, the Fund’s strategy is based on its own research process. Portfolio management assesses whether a company facilitates, enhances, or uses artificial intelligence technologies.
The classification is not arbitrary. On the contrary, it is determined by a combination of quantitative factors and qualitative analysis.
In the first case, data such as the company’s revenue from artificial intelligence is considered. The magnitude of the resources dedicated to this technology is also measured.
In the second case, the creation, distribution, improvement, or integration of artificial intelligence products and services is analyzed. This work is carried out based on public information or direct interaction with the company.
In this way, portfolio management seeks a comprehensive view of how each company participates in the expansion of artificial intelligence.