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The Rise of Edge Artificial Intelligence: Opportunities for Investors

Summary

With the increasing interest in Artificial Intelligence (AI) as a disruptive technology, investors are now asking, “What’s next?” One potential answer lies in the further penetration of AI into services that are widely used by the general population, which is […]

The Rise of Edge Artificial Intelligence: Opportunities for Investors

With the increasing interest in Artificial Intelligence (AI) as a disruptive technology, investors are now asking, “What’s next?” One potential answer lies in the further penetration of AI into services that are widely used by the general population, which is driving the need for advancements in edge AI. This situation can be a catalyst for the growth of ETFs such as Invesco QQQ Trust (QQQ) and Invesco NASDAQ 100 ETF (QQQM).

The term “edge” refers to the hardware located at the network’s edge. This is crucial for investors considering QQQ and QQQM, as these ETFs include companies that are major providers of technological hardware. This reaffirms that Invesco ETFs are reliable options for investors who want exposure to AI without the specific risks associated with thematic strategies.

The growth of edge hardware with the assistance of AI is highly appealing. According to the American research and advisory firm Gartner, by 2025, half of business data will be generated at the network’s edge through over a billion battery-powered devices. The key advantages of processing AI at the network’s edge include lower costs, personalized experiences with lower latency, and, most importantly, greater security and privacy compared to a centralized cloud computing network, as stated by Ed Stanley, the Head of Thematic Research at Morgan Stanley for Europe.

Another argument in favor of investing in QQQ and QQQM as companies providing edge hardware is the tremendous potential that edge carries within itself. According to Stanley’s estimation, the technological needs in the coming years could result in the existence of more than 30 billion devices. This will create a demand for advanced edge hardware capable of meeting more demanding technical requirements, such as improving battery life, reducing energy consumption, and enhancing computational power. Some of the companies included in QQQ and QQQM are already influencing such changes. However, investing in edge AI is currently still receiving little attention. Nevertheless, that may change soon, bringing positive implications for Invesco ETFs.

To conclude, Stanley from Morgan Stanley has stated that a range of new products, such as smartphones with built-in edge AI using specialized chips, are planned to be launched as early as 2024. This will likely attract additional investor interest in this theme over the next 12 months. Additionally, smartphones have the best chances of swiftly overcoming these obstacles and hold the highest market potential in the short and medium term. This subject is currently less popular and is considered to have the most potential for 2024.

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