How to Invest in AI (Artificial Intelligence) UK

Authored by:
Thomas Drury
Adam Woodhead

Adam Woodhead

Co-Founder

Seasoned finance professional with 10+ years' experience. Chartered status holder. Proficient in CFDs, ISAs, and crypto investing. Passionate about helping others achieve financial goals.

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Reviewed by:
Adam Woodhead
Adam Woodhead

Adam Woodhead

Co-Founder

Adam is a Co-Founder and content creator for TIC. His key areas of interest are Crypto and blockchain technology.

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Last Updated 20/01/2023
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showcasing the process of investing in artificial intelligence within the UK context. It features a digital investment platform interface highlighting AI opportunities, adorned with AI and British symbols to convey the innovative and forward-thinking nature of AI investments available to UK investors

Please bear in mind that the value of investments can decrease in addition to increasing, which means there is a possibility of receiving an amount lower than your initial investment. It is generally advisable to retain your investments for a minimum of five years in order to maximize the likelihood of achieving your desired returns. Capital at risk.

Quick Answer: How to Invest in AI in the UK in 2024?

Investing in AI (Artificial Intelligence) in the UK in 2024 offers exciting opportunities. Here’s a straightforward approach to get you started:

  1. Research and Education:

    • Stay Informed: Keep up with the latest trends in AI technology and market developments.

    • Understand the Basics: Familiarize yourself with basic investment principles and AI-specific considerations.

  2. Choose Your Investment Path:

    • Direct Stock Investment: Purchase stocks of leading AI companies in the UK or global market.

    • AI-focused ETFs (Exchange-Traded Funds): Opt for ETFs that specialize in AI and technology sectors for diversified exposure.

    • Start-Up Investments: Consider venture capital opportunities in emerging AI start-ups, although this involves higher risk.

  3. Brokerage Account Setup:

    • Open an account with a reliable brokerage firm that provides access to UK and international AI stocks and ETFs.

  4. Risk Assessment:

    • Evaluate your risk tolerance. AI investments can be volatile, so it’s crucial to understand your capacity for risk.

  5. Investment Strategy Development:

    • Short-Term vs. Long-Term: Decide if you are looking for quick gains or long-term growth.

    • Diversification: Don’t put all your funds into one asset. Diversify across different AI companies and sectors.

  6. Stay Updated and Adjust:

    • AI is a rapidly evolving field. Regularly review and adjust your portfolio as needed based on the latest market trends.

  7. Regulatory Compliance:

    • Ensure you are aware of and comply with UK investment regulations and tax implications.

Expert Tip: Consulting with a financial advisor who has expertise in technology investments can provide personalized advice based on your financial goals.

By following these steps, you can confidently start your journey in AI investing in the UK in 2024. Remember, like any investment, AI carries risks and it’s important to do thorough research and consider seeking professional advice.

AI Stock Platform Comparison Chart

Trading 212
Lightyear
Interactive Investor
Etoro Logo
Etoro
IG
Regulator
FCA
FCA
FCA
FCA
FCA
Mobile App Usability
4.5/5
4.6/5
4/5
4.2/5
3.5/5
Variety of Assets
12,000+ global stocks & ETFs, commodities, forex
Stocks 3000+, ETF's 1000+
1,000+ ETFs, Stocks (UK & International), Bonds, Ethical Investments
Stocks, cryptocurrencies, CFDs
18,000+ markets, stocks, ETFs, commodities, currencies, bonds, funds
ISA Available
Yes
No
Yes
Yes (in conjunction with Moneyfarm)
Yes
Trust Pilot Score
4.6/5
4.8/5
4.7/5
4.3/5
4./5
Fee Score
4/5
4.5/5
4.2/5
3.5/5
4/5
Overall Review Score
4.5/5
4.4/5
4.4/5
3.9/5
3.9/5

Best Investment Platforms to Invest in AI

trading 212 logo white and black linking to homepage
4.5/5

TIC Trading 212 Score 4.5/5

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Trading 212 - Best for beginners and casual investors

Trading 212 is an online brokerage platform that allows individuals to trade a wide range of financial instrument.

Pros

Cons

Please bear in mind that the value of investments can decrease in addition to increasing, which means there is a possibility of receiving an amount lower than your initial investment. It is generally advisable to retain your investments for a minimum of five years in order to maximize the likelihood of achieving your desired returns. Capital at risk.

Lightyear Logo
4.5/5

TIC Lightyear Score 4.5/5

Lightyear - Best Overall AI Stock & ETF Platform

Lightyear is a user-friendly and low-cost trading platform that offers a range of stocks and ETFs, with a focus on simplicity and accessibility for beginners. It stands out for its multi-currency account feature, competitive fees, and the unique advantage of earning interest on uninvested cash.

Pros

Cons

Please bear in mind that the value of investments can decrease in addition to increasing, which means there is a possibility of receiving an amount lower than your initial investment. It is generally advisable to retain your investments for a minimum of five years in order to maximize the likelihood of achieving your desired returns. Capital at risk.

interactive investors logo for interactive investor review
4.2/5

TIC Interactive Investor Score 4.2/5

Interactive Investor - Best suited for active, experienced investors

Interactive Investor is a well-established UK-based investment platform offering a comprehensive range of investment options including stocks, funds, and ETFs, along with a variety of ISA and pension products. Known for its fixed-fee pricing structure, it caters well to both active traders and long-term investors, providing extensive research tools and resources.

Pros

Cons

Please bear in mind that the value of investments can decrease in addition to increasing, which means there is a possibility of receiving an amount lower than your initial investment. It is generally advisable to retain your investments for a minimum of five years in order to maximize the likelihood of achieving your desired returns. Capital at risk.

Etoro Logo
3.9/5

TIC eToro Score 3.9/5

eToro - Ideal for both trading and long-term investing.

eToro stands out for its unique social trading features, including copy trading, which allows users to mimic the trades of experienced investors, making it an innovative choice especially for beginners. The platform offers a diverse range of trading options including stocks, cryptocurrencies, and CFDs, catering to various investment preferences and strategies.

Pros

Cons

Please bear in mind that the value of investments can decrease in addition to increasing, which means there is a possibility of receiving an amount lower than your initial investment. It is generally advisable to retain your investments for a minimum of five years in order to maximize the likelihood of achieving your desired returns. Capital at risk.

IG logo red and white linking to IG homepage
3.9/5

TIC IG Score 3.9/5

IG - Best for a range of markets and additional trading services

IG is a leading online trading and investments provider offering a comprehensive range of over 18,000 markets, including stocks, ETFs, forex, and commodities, ideal for traders seeking extensive market access. Renowned for its advanced trading platforms and robust educational resources, IG caters to both experienced traders and those keen on developing their trading skills.

Pros

Cons

Please bear in mind that the value of investments can decrease in addition to increasing, which means there is a possibility of receiving an amount lower than your initial investment. It is generally advisable to retain your investments for a minimum of five years in order to maximize the likelihood of achieving your desired returns. Capital at risk.

Investing in AI Stocks

Investing in AI stocks in 2024 offers an intriguing opportunity to participate in one of the most dynamic and rapidly advancing sectors of the technology industry. As AI continues to revolutionize industries ranging from healthcare to personal finance, the potential for growth in this sector is substantial. However, as with any investment, it is crucial to approach AI stock investments with a well-informed strategy, understanding the unique aspects of this market.

AI technology is at the forefront of the fourth industrial revolution, driving changes in how businesses operate and interact with their customers. This transformative power of AI is not just confined to tech companies; it is permeating through various sectors, creating new opportunities and disrupting traditional business models. The increasing adoption of AI across diverse industries is a key growth driver, making AI stocks an attractive investment option.

When considering investing in AI technology stocks though, it’s important to look beyond the immediate hype and evaluate the long-term potential of these companies. Companies that are leaders in AI technology often invest heavily in research and development, which can lead to significant breakthroughs but also involves substantial costs and risks. Investors should evaluate the financial health, management quality, and track record of innovation of these companies to gauge their potential for sustainable growth.

Moreover, regulatory changes and ethical considerations around AI are also critical factors that can impact these software companies” operations and, consequently, their stock performance. As AI continues to evolve, so does the regulatory landscape, which can pose both challenges and opportunities for AI companies. Ethical use of AI and data privacy are becoming increasingly important, and companies that proactively address these concerns are likely to fare better in the long run.

Finally, the AI market is highly competitive, with numerous companies vying for market share. This competition drives innovation but also makes it challenging for investors to pick winners. It’s not just about the big names; many smaller and emerging companies are making significant strides in AI, offering potentially lucrative investment opportunities. However, these investments come with higher risks compared to established players.

In summary, investing in AI stocks requires a balanced approach, combining a deep understanding of the technology with a thorough analysis of the market dynamics and individual company prospects. As the AI landscape continues to evolve, staying informed and adaptable will be key to successful investing in this exciting and rapidly changing sector.

Top AI Stocks

Based on recent financial analyses and market share trends, here are some of the top AI stocks to consider for investment in 2024:

  1. Adobe Inc (NASDAQ: ADBE): Known for its creative and digital marketing solutions, Adobe has been integrating AI into its products, enhancing capabilities such as graphic design and photo editing through AI-driven features​​.

  2. Advanced Micro Devices, Inc. (NASDAQ: AMD): A major player in the semiconductor industry, AMD is gaining attention for its AI-focused chips, positioning itself as a key competitor in the AI hardware market​​.

  3. C3.ai Inc (NYSE: AI): This enterprise AI software provider has shown impressive growth with its C3 AI platform, enabling the design, development, and deployment of enterprise AI applications​​.

  4. Palantir Technologies Inc. (NYSE: PLTR): Specializing in big data analytics, Palantir has experienced significant growth due to increased demand for its AI solutions​​.

  5. CrowdStrike Holdings, Inc. (NASDAQ: CRWD): A leader in cybersecurity, CrowdStrike’s AI-driven Falcon XDR platform has been gaining popularity, contributing to its strong market performance​​.

  6. Snowflake Inc. (NYSE: SNOW): Snowflake, known for its cloud-based data warehousing services, is also emerging as a key player in the AI and data analytics sector​​.

  7. Mongodb Inc (NASDAQ: MDB): This database platform has been integrating AI into its services, with partnerships like AWS’s CodeWhisperer and Microsoft GitHub Copilot enhancing its offerings​​.

  8. Palo Alto Networks Inc (NASDAQ: PANW): As a cybersecurity firm, Palo Alto Networks is leveraging AI to enhance its security solutions, marking it as a significant player in the AI-driven cybersecurity market​​.

These companies represent a blend of established tech giants and emerging players in the AI space. Their involvement in AI ranges in multiple ways, from software and services to hardware and infrastructure, reflecting the diverse applications and potential of AI technology across different industries. When considering these stocks, it’s important to conduct thorough research and consider the specific dynamics of the AI market, including technological advancements, competitive landscape, and regulatory environment.

Investing in AI ETFs

Investing in AI Exchange-Traded Funds (ETFs) offers a more diversified approach to entering the AI market compared to individual stocks. AI ETFs pool investments in a range of companies involved in artificial intelligence, including both big names and smaller, specialized firms. This diversification can help mitigate the risk associated with the volatility of the AI sector, as the impact of any single company’s performance is balanced by the others in the fund.

When investing in AI ETFs, it’s important to understand the composition of the ETF and its focus. Some AI ETFs concentrate on companies that are directly involved in developing AI technologies, such as machine learning and neural networks. Others may include companies that extensively use AI in their operations or business models, such as data analytics firms or companies that integrate AI into consumer products.

Investors should also consider the ETF’s management style, fees, and performance history. Actively managed ETFs, where fund managers regularly make decisions about which stocks to include, might have higher fees but could offer better returns if managed effectively. Conversely, passively managed ETFs, which typically track an AI index, usually have lower fees and offer a more straightforward representation of the AI market’s overall performance.

Finally, it’s crucial to keep in mind the liquidity of AI ETFs. While some AI ETFs are highly traded with good liquidity, others may be less so, potentially making it harder to buy or sell shares quickly.

Person in a group call at their computer

Top AI ETFs

Here are some AI ETFs that have been recognized for their performance and potential:

  1. Global X Robotics & Artificial Intelligence ETF (BOTZ): This ETF invests in companies from around the world that are involved in the development and production of robotics and AI.

  2. ARK Autonomous Technology & Robotics ETF (ARKQ): Managed by ARK Invest, this ETF focuses on companies that are leading the way in autonomous technology and robotics, including AI.

  3. iShares Robotics and Artificial Intelligence ETF (IRBO): IRBO offers exposure to global companies that are poised to benefit from the long-term growth and innovation in robotics and AI.

  4. Robo Global Robotics and Automation Index ETF (ROBO): This ETF tracks the performance of companies across the globe that are in the robotics, automation, and AI industries.

Investors should conduct their own research or consult with a financial advisor to determine which AI ETF best aligns with their investment goals and risk tolerance.

Bull and bear pulling away from each other with green and red arrows

Choosing AI Stocks or ETFs

Deciding whether to invest in AI stocks or ETFs depends on various factors including investment goals, risk tolerance, and market knowledge. Here are some key considerations:

  • Risk Tolerance and Diversification: ETFs generally offer greater diversification, which can lower risk. Individual stocks might offer higher returns but come with higher risk.

  • Market Knowledge and Time Commitment: Investing in individual stocks requires more research and active management. ETFs, on the other hand, require less time and expertise, as they offer a more passive investment approach.

  • Investment Goals: If an investor is particularly bullish about a specific company’s prospects in AI, investing in its stock could be more appealing. For those looking for broader exposure to the AI market, ETFs might be a better choice.

  • Liquidity Needs: Individual stocks typically offer higher liquidity than ETFs. This might be an important factor for investors who prioritize the ability to quickly enter or exit positions.

  • Cost Considerations: ETFs come with management fees, though they can be relatively low. Individual stock trades may incur brokerage fees, depending on the platform used.

In summary, choosing between AI stocks and ETFs should align with an investor’s individual financial goals, risk profile, market knowledge, and investment strategy. It’s often beneficial to have a mix of both in a diversified portfolio to balance potential risks and rewards.

AI Investment Pros & Cons

 

Investing in AI offers a unique blend of opportunities and challenges. As AI technology continues to evolve and integrate into various sectors, it presents a compelling case for investment. However, like any investment, it comes with its own set of risks.

Risks in AI Investment

  1. Market Volatility: The AI sector can be highly volatile due to rapid technological changes and market competition. This can lead to significant fluctuations in stock prices.

  2. Regulatory Risks: As AI technology evolves, so does the regulatory landscape. Changes in data privacy laws and AI governance can impact AI companies’ operations and profitability.

  3. Technological Obsolescence: The fast pace of innovation in AI means that today’s leading technologies may quickly become outdated, impacting the investment in companies that fail to keep up.

  4. Ethical and Social Concerns: Issues like data privacy, ethical AI use, and potential job displacement due to automation can affect public perception and regulatory decisions, impacting AI investments.

  5. High Valuations: Many AI companies, especially in the tech sector, have high valuations with significant growth already priced in, which could limit future returns.

Benefits of AI Investment

  1. Growth Potential: AI is a rapidly growing field with significant potential for expansion, offering lucrative opportunities for investors.

  2. Diversification: Investing in AI can add diversification to an investment portfolio, as AI influences a wide range of sectors including healthcare, finance, automotive, and more.

  3. Innovation and Development: Investing in AI contributes to the advancement of groundbreaking technologies that can transform industries and create new markets.

  4. Global Reach: AI’s impact is global, providing investment opportunities in various geographic regions and markets.

  5. Long-Term Benefits: AI investments can offer substantial long-term gains as AI technologies become more integrated into everyday life and business operations.

Conclusion

Investing in AI presents a unique opportunity in the world of modern finance. While it comes with its share of risks, the potential rewards are significant. The key to successful AI investing lies in thorough research, a clear understanding of the risks involved, and a well-thought-out investment strategy. It’s also important to stay informed about the latest developments in AI technology and market trends.

As with any investment, diversification is crucial. Balancing AI investments with other assets can help mitigate risk. Additionally, considering both direct investments in AI companies and indirect exposure through AI ETFs can provide a more balanced approach.

Ultimately, the decision to invest in AI should align with an individual’s investment goals, risk tolerance, and time horizon. As AI continues to evolve and reshape industries, it offers an exciting frontier for investors willing to navigate its complexities. The AI sector’s potential for growth and innovation makes it an intriguing addition to any investment portfolio.

References

FAQs

A: To invest in AI in the UK, start by researching AI-focused companies and funds. Consider opening a brokerage account that allows you to buy stocks and ETFs in AI companies. Analyze market trends, seek advice from financial advisors and industry experts, and diversify your investments across various AI sectors.

A: A fund’s expense ratio is the annual fee that mutual funds or ETFs charge their shareholders. It’s important because it affects the net return on investment. Lower the expense ratio ratios can lead to higher net returns for investors.

A: AI tools are software and platforms that use artificial intelligence to analyze market data, predict trends, and assist in making investment decisions. These artificial intelligence tools can provide investors with insights based on large datasets, helping them to make more informed and strategic investment choices.

A: Artificial intelligence is transforming sectors like healthcare, finance, retail, and more by optimizing operations, enhancing customer experiences, and driving innovation. It’s leading to more efficient processes, personalized services, and new business models.

A: Bing, as a search engine, offers access to a wide range of financial news, market analysis, and data on AI companies and trends. Investors can use Bing to stay updated on the latest developments in AI technology and market movements.

A: AI infrastructure refers to the hardware and software necessary to develop and run AI applications, like data centers and cloud computing services. For investors, understanding the AI infrastructure landscape can help identify companies with strong foundations and growth potential.

A: Cloud computing provides the necessary computing power and storage for AI applications. Investing in cloud computing companies can be a way to indirectly invest in AI, as these platforms are integral for AI’s development and deployment.

A: Diversifying investments to gain exposure across multiple AI stocks can reduce risk. Since the AI sector is rapidly evolving, investing in various companies can provide exposure to different AI applications and innovations.

A: Publicly traded AI companies can be found through stock market research, financial news, and investment platforms. Look for publicly traded companies that are heavily involved in AI technology, either through development or application.

A: Human intelligence is crucial in interpreting AI data, understanding market contexts, and making ethical investment decisions. While AI provides data-driven insights, human judgment is key in strategic decision-making.

A: Investing in AI startups can offer high growth potential but comes with higher risks. It’s important to thoroughly research the startup’s business model, technology, market potential, and the experience of its management team.

A: Well-known AI stocks include large tech companies like Alphabet (Google), Amazon, NVIDIA, and Microsoft, which are heavily investing in AI research and development.

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Epilogue

Who Created This Content: This guide was authored by Thomas Drury is an experienced financial trader in leverage intruments, crypto and general investing.

He has over a decade experience in finance and holds Chartered Status in the financial industry, Thomas’s specialty is trading CFDs, Forex and Day Trading.

His crypto portfolio is heavily weighted towards BTC and Eth, but enjoys trading low cap crypto’s with higher volatility. Thomas’s favourite trading strategy is break out Trading.

ow This Content Was Created: Our assessment of the best place on how to invest in AI is rooted in rigorous research and firsthand experience. Here’s our methodology:

  • Platform Testing: We actively tested multiple platforms over a span of six months, analysing their functionalities, ease of use, and reliability.

  • Fee Analysis: Each platform’s fee structure was dissected to ascertain its competitiveness in the market.

  • User Feedback: We engaged with real users and considered their reviews and experiences, lending a holistic perspective to our evaluation.

  • Market Dynamics: Regular updates from industry news, changing regulations, and market dynamics ensure the guide remains current and reliable.

  • AI-Assistance: While human judgment and expertise are at the core of our assessments, we utilized AI tools to improve structure, critique our work.

Note: Our use of AI tools is strictly for data gathering and content assistance. All conclusions drawn and recommendations made are based on human analysis and judgment.

Why This Content Was Created: Our primary objective in creating this guide is to empower traders, both seasoned and novices, with impartial, comprehensive, and actionable information to make informed decisions.

We understand the complexity of the stock trading world and aim to simplify it for our readers.

While we hope our content is discoverable by those seeking insights, our main priority is to provide genuine value to our visitors.

We staunchly oppose content creation practices that manipulate search rankings or violate any standards of integrity.

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