How the fund works

Artificial intelligence (AI) looks to synthesise, automate and optimise the process of converting information into useful and actionable knowledge. 

At the cutting edge of innovation, engineers have built self-driving cars that have clocked up millions of miles on our roads while making autonomous decisions. Scientists are developing service robots to provide care for the elderly and disabled. Yet the technology is still in its infancy. AI has the potential to transform our global economy in profound ways by disrupting entire sectors.

Smith & Williamson has launched this Fund at a crucial moment for AI, which many experts believe is set to expand exponentially and drive economic growth around the world.

Please remember investment involves risk. The value of investments and the income from them can fall as well as rise and investors may not receive back the original amount invested. Past performance is not a guide to future performance.

Investment process

Capturing the investment opportunities presented by AI’s influence on the global economy requires active management with a broad and flexible approach. The managers use various tools to identify companies where revenue growth is driven by the development and application of AI. This stock-selection process is enhanced by a proprietary AI system, which helps to identify those companies using or developing artificially intelligent systems.

  1. Research investible universe using an AI-driven screen to identify companies where revenues are directly impacted by AI.
  2. Select the most attractive investment opportunities using fundamental research and valuation measures.
  3. Construct a portfolio that is diversified by sector, region and company size.
  4. Monitor risk and performance and manage the Fund to adapt to changing conditions in the global economy and latest industry developments.

Investment strategy

The Smith & Williamson Artificial Intelligence Fund (Ai) provides investors with direct revenue exposure to companies that have the potential to harness the power of AI. By investing in the shares of these leading businesses, we manage a portfolio that is diversified in three ways:

Industry sector. Although much of the hardware and software is developed by technology firms, AI applications are widespread across the economy including both defensive sectors (such as healthcare and consumer areas) and cyclicals (such as industrials and financial services).

Global region. AI firms are spread across the world in major developed countries and some of today’s fastest-growing emerging markets. AI is not just about Silicon Valley.

Company size. With a minimum market capitalisation level of c.$250 million, the Fund has the flexibility to invest in entrepreneurial firms with huge growth potential as well as more established businesses with strong market positions and competitive scale advantages.

This broad diversification provides the freedom to capture opportunities from a wide investment universe as well as help manage the risks associated with fluctuating economic cycles around the world.

Investment expertise

The Fund managers are Chris Ford and Tim Day, who have extensive experience of managing global equity funds. They are backed by Smith & Williamson’s long-standing relationships with entrepreneurs and early-stage investors, and the access to investment opportunities these connections provide.

The team also benefits from its physical location in London, which is a leading AI hub for private and public companies, and research institutes. The UK has a rich heritage in computer development and commercial AI applications stretching back many decades, and is home to pioneering universities in these fields.

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