Meet the Spectacular ETF With Big Positions in Stocks Like Palantir, Microsoft, and Salesforce. It Could be a Brilliant Buy as the AI Trade Unwinds.
Investors are increasingly nervous about the sustainability of the artificial intelligence infrastructure spending boom.
Overview
The iShares Expanded Tech-Software ETF (NYSEMKT: IGV) is an exchange-traded fund (ETF) that holds over 100 different software stocks, including industry leaders like Palantir Technologies, Microsoft, and Salesforce. The ETF has suffered a decline of 11% this year amid concerns that artificial intelligence (AI) could disrupt the legacy software-as-a-service (SaaS) business model.
The potential risks are twofold. First, some investors think AI will shrink the global workforce, thus reducing the revenue of SaaS companies that charge customers on a per-user basis. Second, some investors fear AI-powered programming tools like Claude Code will allow businesses to create their own versions of popular software products, rendering legacy vendors obsolete.
Details
But the AI boom has recently run into trouble. Wall Street is questioning the sustainability of the data center infrastructure spending boom because the sheer cost of chips and other components is making AI models too expensive to deploy at scale in many cases. Here's why that could be good news for the iShares Expanded Tech-Software ETF.
Source
Originally published at www.fool.com.