Over the coming years, Artificial Intelligence (AI) technology is expected to transform every industry and society. Productivity and efficiency gains from AI could significantly boost global economic growth.
Capturing the value from this multi-decade trend requires technical as well as investment expertise. Consider an active, fundamentals-focused approach that offers investors access to the full spectrum of opportunities created by AI’s disruptive innovations.
Why active AI solution?
Misallocation of capital is a real risk for investors through periods of disruption and technological advancement.
Managing concentration risk on momentum stocks
Avoiding ‘momentum chasing’ by distinguishing between sentiment-driven hype and fundamental investment cases.
Seeking opportunities in overlooked companies
Identifying successful companies in the IT space that are not captured by passive investing.
Accessing the full AI spectrum
Broadening the lens of opportunity to access potential ‘winners of the AI race’ in sectors beyond IT.
“AI is the most powerful application of computing and has become possible because of 50 plus years of advancements in computing power. As computing power increases, new use cases are created and the market for computing increases. We believe AI is a multi-decade investment opportunity and it will change how we work, live and interact among humans and machines.”
Jeffrey Lin
Fund manager
Access M&G Global AI Themes Fund
Why this fund?
Rare blend of AI expertise
The fund managers’ distinctive background in electrical engineering combined with 20+ years of investment expertise in fields related to the AI trend and early AI investing since 2016.
Diversified exposure to AI
A global thematic fund that taps into the full spectrum of AI opportunities at all stages of the AI innovation life cycle.
Quality and growth bias
Investment process based on engagement with technical teams and executive managers to unearth well-managed companies whose long-term prospects are not fully appreciated by the stock market.
Where does the fund invest?
The fund offers diversified exposure over the full innovation lifecycle of AI by investing in three distinct categories of AI opportunities: companies that can enable, provide or benefit from the structural tailwind that will see AI becoming a mainstream technology.
Through an active, bottom-up investment approach, the fund managers seek to identify companies where the adoption of AI applications could improve long-term revenue growth or increase profit margins. They construct a ‘best ideas’ portfolio typically composed of 50-70 stocks, where they believe AI will have a material impact on the business and deliver long-term growth.
Enablers 30-40%*
Supplying the key technology. Companies that manufacture semiconductors as well as companies that provide data collection, data management, communication services or cybersecurity are considered ‘enablers’.
Providers 30-40%*
Turning AI into tangible products. They tend to be software companies that leverage AI to make their software more powerful, easier to use or deliver more functionality.
Beneficiaries 25-40%*
Benefiting from deploying AI solutions. Companies that are not in the technology sector, but use AI to improve their products, services or internal processes.
*The fund may allocate to these three categories in any proportions but does not typically expect to hold more than 50% of its net asset value in any one category. Internal limits are shown for illustrative purposes only and are subject to change.
Investment policy
The Fund aims to provide a higher total return (capital growth plus income) than that of the global equity market over any five-year period while applying ESG Criteria. At least 80% of the Fund is invested in the shares and equity related instruments of companies (including closed-ended real estate investment trusts, which may represent up to 20% of the net asset value of the Fund), across any sector and of any size, from anywhere in the world, including emerging markets. The Fund may invest in China A- Shares via the Shanghai-Hong Kong Stock Connect and the Shenzhen-Hong Kong Stock Connect or via the QFI status granted to the investment manager. The Fund may invest up to 5% in shares and equity-related securities of Special Purpose Acquisition Companies (SPACs). The Fund invests in securities that meet the ESG Criteria, applying an Exclusionary Approach and Positive ESG Tilt as described in the precontractual annex. The fund’s recommended holding period is 5 years.
The main risks associated with this fund:
- The value and income from the fund's assets will go down as well as up. This will cause the value of your investment to fall as well as rise. There is no guarantee that the fund will achieve its objective and you may get back less than you originally invested.
- Investing in emerging markets involves a greater risk of loss due to greater political, tax, economic, foreign exchange, liquidity and regulatory risks, among other factors. There may be difficulties in buying, selling, safekeeping or valuing investments in such countries.
- The fund can be exposed to different currencies. Movements in currency exchange rates may adversely affect the value of your investment.
- The fund has a large exposure to the Information Technology sector. As a result, the fund may be more volatile and vulnerable to market sentiment and risks specific to this sector than funds that are well diversified across multiple sectors.
The fund invests mainly in company shares and is therefore likely to experience larger price fluctuations than funds that invest in bonds and/or cash.
Further details of the risks that apply to the fund can be found in the fund's Prospectus.
