Investors are increasingly drawn to the emerging field of artificial intelligence (AI), and one avenue to tap into this lucrative market is through the Roundhill Generative AI and Technology ETF. As the end of 2025 approaches, many investors are reflecting on their portfolio performance, especially those who may have missed the AI boom and underperformed against the benchmark S&P 500 index. Notably, tech giants such as Nvidia, Broadcom, and Alphabet have seen significant returns, further emphasizing the potential benefits of investing in AI-related stocks.
As 2026 nears, it could be the right moment for investors to realign their portfolios, with AI poised to be a key driver of stock market returns. The Roundhill ETF offers a straightforward method for investors to gain exposure to a concentrated basket of leading AI stocks, allowing them to bypass the daunting task of selecting individual winners and losers.
This exchange-traded fund focuses exclusively on a select group of companies that are integral to the AI ecosystem, committing to just 50 stocks in its portfolio. While this results in limited diversification, the top five holdings alone comprise nearly a quarter of the ETF’s total value, highlighting its top-heavy nature. Consequently, the ETF experiences considerable volatility, suggesting it should be considered within a wider array of investments.
The ETF’s leading positions are occupied by major players in the AI sector: Alphabet, Nvidia, Microsoft, Meta Platforms, and Broadcom. Collectively, these companies have delivered impressive median returns of 37% in 2025, which significantly outstrips the S&P 500’s 16% increase.
Apart from these top five stocks, other noteworthy companies within the Roundhill ETF add to its appeal. Advanced Micro Devices (AMD) is gearing up to launch an advanced series of AI data center chips in 2026, positioning itself as a formidable competitor to Nvidia. Palantir Technologies leverages AI through its Gotham and Foundry platforms to assist businesses and governmental bodies in maximizing value from internal data. CoreWeave stands out as a significant provider of AI infrastructure, offering cloud-based computing capacity for businesses keen to develop AI software. Micron Technology supplies high-bandwidth memory solutions crucial for AI operations, while Snowflake provides essential cloud tools that facilitate data collection and AI software deployment.
These additional stocks have also registered exceptional returns this year, indicating that investors need not limit themselves to the established market leaders to realize substantial gains.
Since its inception in 2023, the Roundhill ETF has experienced remarkable success, surging 53% in 2025 and outpacing the S&P 500’s performance. However, it’s essential to note that its relatively short track record does not provide insights into how it would fare in a bear market or during economic downturns.
The fund does come with a cost; it features an expense ratio of 0.75%. For instance, a $10,000 investment would incur an annual charge of approximately $75, contrasting sharply with passive index funds that may charge as little as $3. Currently, high fees seem negligible compared to the ETF’s returns, but if the AI market cools down, investors might find these fees less palatable.
Despite uncertainties, optimism remains prevalent, especially as market leaders like Nvidia predict that AI infrastructure spending could soar to $4 trillion by 2030. Although there are no guarantees that the Roundhill ETF will replicate its impressive annual returns in 2026, it appears well-positioned to continue outperforming the broader market in the foreseeable future.
