Another Algorithm Chases Its Tail

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It appears Intelligence Driven Advisers, a firm whose name suggests a degree of optimism rarely justified in this business, has allocated nearly eight million dollars to the Global X Artificial Intelligence & Technology ETF. One imagines a spreadsheet, a quarterly target, and a vague hope for disruption. The purchase, 153,047 shares to be precise, occurred on January 23rd, 2026. A date that will likely fade into the indistinguishable gray of market history.

The sum, $7.78 million, is a curious thing. Enough to briefly animate the share price, yet a mere rounding error in the grand scheme. At quarter’s end, the stake remained at the same value, a small comfort in a world where even numbers seem to shift without reason. One suspects the analysts involved have families to support, just like everyone else.

This new position represents 1.11% of their reportable assets. A statistically insignificant percentage, yet enough to warrant a press release, and thus, this observation. Their larger holdings – DFUS, IWY, QEFA, IUSB, and DYNF – suggest a diversified, if somewhat uninspired, approach to wealth preservation. One can almost picture the portfolio manager, sighing softly as he clicks ‘buy’.

As of January 22nd, 2026, AIQ shares were trading at $52.45, a 29.3% increase over the past year. A respectable return, certainly, and enough to briefly impress a client. It even outperformed the S&P 500 by 15.73 percentage points. But these numbers, like all numbers, are ephemeral. A momentary reprieve from the inevitable drift toward entropy.

The dividend yield, a paltry 0.18%, is almost an afterthought. A token gesture toward income, barely enough to cover the cost of a decent cup of coffee. And yet, investors cling to these metrics, searching for order in a chaotic world.

The fund itself, AIQ, is a curious creation. It seeks to replicate the performance of an index focused on artificial intelligence and big data. A noble goal, perhaps, but one predicated on the assumption that these technologies will continue to flourish. A dangerous assumption, given the history of technological innovation.

The underlying holdings are composed primarily of equities from firms developing or utilizing AI. A non-diversified portfolio, which is to say, a gamble. The expense ratio, 0.68%, is not insignificant. A small price to pay for access to the future, or a rather large one for participation in a speculative bubble?

The fund’s strategy is to chase returns, to replicate the success of others. A perfectly reasonable approach, if one accepts the premise that the past is a reliable predictor of the future. But the future, as anyone who has lived long enough will tell you, rarely unfolds as expected.

Intelligence Driven Advisers’ foray into AIQ suggests a belief in the potential of this sector. A belief fueled by optimism, or perhaps, by the simple need to justify their fees. The rapid expansion of the artificial intelligence industry is undeniable, and AIQ provides a convenient way to participate in this growth. But growth, like all things, is subject to the law of diminishing returns.

The fund’s holdings include global AI companies, offering broad exposure across the ecosystem. This diversification is a welcome addition, although it does little to mitigate the inherent risks of investing in a single sector. The more than $7 billion in assets under management provides liquidity, but liquidity is a fleeting comfort in a crisis.

AIQ is, ultimately, a product of its time. A reflection of our collective obsession with innovation, and our unwavering faith in the power of technology. It is a gamble, a speculation, a hope. And like all hopes, it is destined to be either fulfilled or dashed. The market, indifferent as ever, will simply move on.

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2026-01-24 03:33