VistaShares Is the Latest ETF Issuer to Bet on the Future of Bots

As it turns out, these actually might be the droids you’re looking for.

While Earth-bound robots haven’t yet reached R2-D2 or C-3PO levels of sophistication, one asset manager is banking on the automated future arriving sooner than we think. VistaShares recently launched its Robotics Supercycle ETF under the ticker RTOO, a nod to everyone’s favorite blue-and-white astromech. Aiming to capture the early phases of a massive, long-term buildout, the fund provides exposure to companies driving robotics across the industrial, healthcare, defense and consumer sectors. 

VistaShares is far from the first issuer trying to capitalize on robots transitioning from science fiction to the real world. The ROBO Global Robotics & Automation Index ETF (ROBO), launched all the way back in 2013, has amassed $1.97 billion, and the Global X Robotics & Artificial Intelligence ETF (BOTZ), launched in 2016, boasts assets of $3.37 billion. While the initial phase of the artificial intelligence trade focused heavily on the “AI brain” (think software, data centers and large language models), we’re now entering the physical AI or hardware phase, said Todd Rosenbluth, head of research and editorial at TMX VettaFi.

“Investing in robotics ETFs is the natural extension of the AI trade because it captures the transition of uploading that digital AI brain into physical machines, vehicles and robots,” Rosenbluth said. 

Do or Do Not …  

ETFs like ROBO and BOTZ not only have long histories but have also gathered significant assets, and a new entrant will face challenges countering those advantages, Rosenbluth said. 

The team at VistaShares thinks it’s up for the challenge: 

• RTOO — as well as the VistaShares Space Supercycle ETF (GALX) and VistaShares Defense Supercycle ETF (AMMO), which it launched alongside — follow VistaShares’ patent-pending “Bill of Materials” investment approach that analyzes supply chains to identify the best companies for a portfolio.  
• “It’s more of a hedge fund strategy,” said Adam Patti, CEO of VistaShares. “We’re not just creating a dumb index.” The secret sauce, he adds, is an investment committee of “global luminaries.” He points to his VistaShares co-founder Jon McNeill, former president of Tesla and an expert in robotics, as an example. 

Supercycle Sectors. VistaShares focuses on the ecosystems behind so-called “supercycles,” or long-term tech-driven disruptive trends. Its Artificial Intelligence Supercycle ETF (AIS) includes familiar names like Nvidia and Micron Technology, but only half the fund is made up of chipmakers. The other half includes hardware, electrical equipment, IT services and more. The fund was recently identified as one of the top ETFs this year excluding leveraged funds, per Morningstar data.