Dan Ives Doubles Down on AI with Second WedBush Thematic ETF

Just like He-Man, Ives has the Power!

Wedbush Fund Advisers and tech analyst Dan Ives launched their second AI-focused ETF yesterday: the Dan Ives Wedbush AI Power & Infrastructure ETF (IVEP). The fund targets the energy, data center and raw materials companies driving the AI wave, including companies like GE Vernova, Siemens Energy and Eaton Corp. The new product follows the firm’s first AI fund, the Dan Ives Wedbush AI Revolution ETF (IVES), which focuses on software and consumer tech giants such as Apple, Amazon and Nvidia. “This [new fund] is all about the power and energy fueling the AI revolution,” Ives told Advisor Upside. “The AI arms race does not happen without power.”

While broad market index funds have exposure to AI infrastructure stocks, sector-specific funds have been performing exceptionally well this year. “Advisors who want real conviction in the AI trade need a dedicated vehicle, not a watered-down version buried inside a broad index,” CEO Gary Wedbush told Advisor Upside.

AI-natomy 101

Wedbush estimates that US data center electricity consumption could reach about 470 terawatt-hours by 2030, about nine times as much electricity as New York City uses in a single year. “As AI adoption accelerates, energy and infrastructure are emerging as critical bottlenecks,” Cullen Rogers, chief investment officer at Wedbush, said in a statement. “Every dollar spent on AI ultimately requires energy.”

So far this year, AI infrastructure funds have been riding high:

• Tortoise AI Infrastructure ETF (TCAI) has surged almost 30% with assets of a little less than $100 million.
• Global X Data Center & Digital Infrastructure ETF (DTCR) has jumped roughly 21.5% with $1.2 billion in assets.
• Defiance AI & Power Infrastructure ETF (AIPO) is up about 20%, holding roughly $250 million in assets.

“Software and infrastructure are the lungs while utility providers are the hearts,” Ives said.

Name Recognition. “A big person, who has a big platform, usually has success in the ETF market,” said Eric Balchunas, senior analyst at Bloomberg Intelligence. He pointed to the accomplishments of the IVES fund, which comes with an expense ratio of 0.75%, and has jumped nearly 18% while gaining $883 million in assets since its launch last June. However, he also said, “It’s harder to get money in the sequel, just like the movies.” 

Balchunas pointed to the Fundstrat Granny Shots US Large Cap ETF (GRNY) from financial analyst Thomas Lee, which has amassed nearly $4 billion in assets. Meanwhile the two funds Lee launched afterward have just over $400 million in assets between the pair. “Being Dan Ives helps,” Balchunas said. “If it’s from a person named Joe Schmo, I would be bearish.”