Trump's $500 Billion Stargate AI Plan Puts 3 ETFs In Focus

Zinger Key Points

Analyst notes that companies that strategically adopt AI are likely to outperform, creating a fertile ground for ETFs to thrive.
Stargate plans to invest an initial $100 billion, and $500 billion over time into building data centers and other AI infrastructure.
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President Donald Trump announced a $500 billion initiative to supercharge the artificial intelligence infrastructure in the United States Tuesday. Flanked by tech titans OpenAI CEO Sam Altman, SoftBank CEO Masayoshi Son, and Oracle ORCL Chairman Larry Ellison, Trump revealed the creation of a new company, Stargate, which he described as "the largest AI infrastructure project in history."

Naturally, investors wasted no time reacting to the announcement. Oracle, Nvidia NVDA, and Arm Holdings ARM saw notable gains, while analysts predict the dominance of AI leaders like those included in the Invesco Top QQQ ETF QBIG will continue into 2025.

Invesco Top QQQ, an actively managed ETF tied to the Nasdaq-100 Mega Index, holds stocks from the Magnificent Seven, including AI giants like Nvidia, along with semiconductor leader Broadcom AVGO. This ETF is poised to capitalize on the rising demand for AI infrastructure, as semiconductor companies like Broadcom gain prominence.

Morgan Stanley analyst Ed Stanley notes that companies that strategically adopt AI—particularly those in software and finance—are likely to outperform, creating a fertile ground for ETFs like Invesco Top QQQ to thrive.

Apart from the Invesco Top QQQ ETF, which debuted in December, other notable beneficiaries of this AI boom are existing ETFs like Global X Robotics & AI BOTZ and Roundhill Generative AI & Technology ETF CHAT.

Here's a closer look at the potential winners:

Global X Robotics & Artificial Intelligence ETF, known for its focus on automation and robotics companies, holds stocks of companies like Nvidia. The ETF can benefit from increased demand for hardware supporting AI infrastructure.

Roundhill Generative AI & Technology ETF invests particularly in companies developing infrastructure, and software that breathe life into AI. As a fund targeting the generative AI, this ETF’s holdings in companies like Microsoft and Meta.

Stargate's Ambitious Vision

Stargate plans to invest an initial $100 billion, with a long-term vision of funneling up to $500 billion into building data centers and other critical infrastructure to support AI development. The project, already under construction in Texas, aims to create 100,000 jobs and establish the U.S. as a leader in AI technology.

Ellison noted that the group's first 1 million-square-foot data center is already underway, emphasizing the need for robust infrastructure to power next-generation AI applications. Altman agreed, calling the project "the most important of this era."

Meanwhile, Elon Musk voiced concerns over Project Stargate's funding, suggesting that SoftBank has secured far less than the ambitious $500 billion investment target.

ETFs focused on AI and technology offer a wise entry point for those looking to jump on the bandwagon. With $175 billion reportedly awaiting deployment into AI projects, the U.S. should attract significant global capital.

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