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First Trust Nasdaq Artificial Intelligence and Robotics ETF (ROBT): How to Invest

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The First Trust Nasdaq Artificial Intelligence and Robotics ETF (ROBT 1.91%) offers a sophisticated way to track AI companies, with an emphasis on fundamental analysis.

It does so through an advanced index methodology designed to target companies that meet specific artificial intelligence and robotics criteria, rather than simply buying the largest names in the space.

However, with this added complexity comes higher costs. ROBT may not be the most beginner-friendly ETF. Here’s what you need to know to decide if the First Trust Nasdaq Artificial Intelligence and Robotics ETF is worth choosing over its AI-focused competitors.

Image source: Getty Images.

Overview

What is First Trust Nasdaq Artificial Intelligence and Robotics ETF?

The First Trust Nasdaq Artificial Intelligence and Robotics ETF is a thematic ETF that tracks the Nasdaq CTA Artificial Intelligence and Robotics index. It is not a mutual fund.

This benchmark takes a more nuanced approach than most AI ETFs by grouping companies into three categories:

  1. Enablers, which develop the hardware, software, and infrastructure that form the building blocks of artificial intelligence.
  2. Engagers, who design, integrate, or deliver AI-driven products and services.
  3. Enhancers, which offer value-added AI capabilities as part of a broader business model, however, AI and robotics are not their primary focus.

Companies are scored across the three categories based on their level of AI involvement, with the top 30 in each category selected. However, the index is not equally split between these groups.

Engagers receive the highest weighting at 60% of the portfolio because they have the most direct AI exposure. Enablers make up 25%, while Enhancers account for15% to provide balance and diversification. Within each group, holdings are equally weighted.

The portfolio is rebalanced quarterly to reset weights and capture relative performance changes, while a semiannual reconstitution ensures the index remains current with evolving AI and robotics developments.

How to invest

How to invest

  1. Open your brokerage app: Log in to your brokerage account where you handle your investments.
  2. Search for the ETF: Enter the ticker or ETF name into the search bar to bring up the ETF’s trading page.
  3. Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this ETF.
  4. Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you’re willing to pay.
  5. Submit your order: Confirm the details and submit your buy order.
  6. Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.

Holdings

Holdings

First Trust Nasdaq Artificial Intelligence and Robotics ETF has a heavy U.S. weighting at 64%, followed by Japan at 9.2%, then the U.K., Israel, South Korea, France, and Taiwan.

The fund holds 100 companies, with 50% classified as technology sector, 22% as industrials, and 9% as healthcare. The remaining holdings are primarily spread across the consumer discretionary and communications sectors, with small allocations to financials, consumer staples, and energy.

The First Trust Nasdaq Artificial Intelligence and Robotics ETF’s largest holdings as of late August 2025 are:

  1. Symbotic (SYM 0.29%): 2.92%
  2. Upstart Holdings (UPST -0.34%): 2.28%
  3. AeroVironment (AVAV -1.81%): 2.25%
  4. Ocado Group (OCDO -1.99%): 2.22%
  5. Palantir Technologies (PLTR -1.39%): 2.14%
  6. Synopsys (SNPS 13.35%): 2.07%
  7. Recursion Pharmaceuticals (RXRX 6.72%): 2.00%
  8. Cadence Design Systems (CDNS 4.95%): 1.91%
  9. Gentex (GNTX 1.36%): 1.91%
  10. Ambarella (AMBA -0.28%): 1.85%

The portfolio has a large-cap tilt, with an average market cap of $28 billion. Valuations are elevated, with shares trading around 29x price-to-earnings, 2.75x price to sales, and 17x price to cash flow.

Should I invest?

Should I invest?

Only consider First Trust Nasdaq Artificial Intelligence and Robotics ETF if you specifically believe in its index methodology and the “engagers, enablers, enhancers” classification system, along with the resulting weighting across these groups.

There is no single “right” way to invest in AI. This is simply how ROBT’s benchmark index approaches selection and weighting compared to competing ETFs. It may under or outperform similar funds at various times.

If you appreciate a more complex, rules-based approach, you may find the fund appealing. But if you’re seeking simplicity, this ETF probably isn’t a fit.

Note that the ETF has historically lagged the broader market and has shown greater volatility than diversified index ETFs, like S&P 500 funds. Its relatively narrow portfolio means individual stock positions can have an outsized impact on performance, for better or worse.

Moreover, investing in AI and robotics carries idiosyncratic risk. These companies are often priced for growth, with high valuations that may be vulnerable to pullbacks if earnings don’t keep pace. The sector also tends to lack exposure to defensive, non-cyclical industries, which can leave long-term investors more exposed during market downturns.

Dividends

Does the ETF pay a dividend?

The First Trust Nasdaq Artificial Intelligence and Robotics ETF has a 30-day SEC yield of 0.27% as of August 2025. The ETF pays dividends semiannually in December and June. The yield is low because many AI-focused companies reinvest earnings into growth rather than paying dividends.

Expense ratio

What is the ETF’s expense ratio?

The expense ratio for First Trust Nasdaq Artificial Intelligence and Robotics ETF is 0.65%, or $65 per $10,000 invested annually. This is higher than both sector and broad market ETFs, and even on the pricey side for a thematic ETF, approaching the cost of some actively managed funds due to its more specialized index methodology.


Expense Ratio

A percentage of mutual fund or ETF assets deducted annually to cover management, operational, and administrative costs.

Historical performance

Historical performance

Since its inception, First Trust Nasdaq Artificial Intelligence and Robotics ETF has generally tracked its benchmark, the Nasdaq CTA Artificial Intelligence and Robotics Index, but has delivered slightly lower returns across most periods due to fee drag.

For example, over the past five years, the fund returned 6.4% annually versus 6.9% for the index.

Where the gap really shows is against the broader market: The S&P 500 has compounded at nearly 16% annually over the same period, far ahead of the ETF.

This underperformance highlights two challenges with thematic funds like this: higher volatility and sector concentration.

While the ETF has at times outpaced the S&P 500 over short stretches, it has struggled to keep up over longer horizons, reflecting the risks of a narrower, more specialized portfolio.

ROBT annualized total returns as of July 31, 2025

1-Year

3-Year

5-Year

Net Asset Value

14.38%

9.54%

6.35%

Market Price

14.56%

9.58%

6.37%

Related investing topics

The bottom line

First Trust Nasdaq Artificial Intelligence and Robotics ETF takes a very involved approach to index construction, breaking the AI and robotics universe into three categories and then assigning different portfolio weights to each group.

While this adds a layer of precision that some investors may appreciate, it also introduces complexity that can make the strategy harder to evaluate and follow compared to simpler, market-cap-weighted thematic ETFs.

The 0.65% expense ratio is on the higher side for a passive ETF and approaches the cost of certain actively managed funds in this space, which could make some investors question whether the additional complexity justifies the fee.

Over the long term, higher costs combined with a specialized weighting methodology may influence performance, so this fund may be best-suited for those who specifically want this unique structure rather than a broader, more conventional approach.

FAQ

Investing in First Trust Nasdaq Artificial Intelligence and Robotics ETF FAQ

What is the best way to invest in AI and robotics?

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The best way to invest in AI and robotics depends on your investment style. Some investors are more comfortable with diversified thematic ETFs like the First Trust Nasdaq Artificial Intelligence and Robotics ETF, while others prefer to build their own portfolios of individual stocks.

Is ROBT a good investment?

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First Trust Nasdaq Artificial Intelligence and Robotics ETF may appeal if you like its complex index approach, but its high fees and convoluted weighting can be drawbacks.

What is the best AI and robotics ETF?

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The best AI and robotics ETF varies by investor goals, costs, and desired exposure, so compare options carefully. Some of the top AI and robotics ETFs by market cap include:

  • Global X Robotics & Artificial Intelligence ETF (NASDAQ:BOTZ)
  • Global X Artificial Intelligence & Technology ETF (NASDAQ:AIQ)
  • iShares Future AI & Tech ETF (NYSEARCA:ARTY)
  • Roundhill Generative AI & Technology ETF (NYSEARCA:CHAT)

Tony Dong has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AeroVironment, Cadence Design Systems, Gentex, Palantir Technologies, Symbotic, Synopsys, and Upstart. The Motley Fool has a disclosure policy.



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AI-powered hydrogel dressings transform chronic wound care

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As chronic wounds such as diabetic ulcers, pressure ulcers, and articular wounds continue to challenge global healthcare systems, a team of researchers from China has introduced a promising innovation: AI-integrated conductive hydrogel dressings for intelligent wound monitoring and healing.

This comprehensive review, led by researchers from China Medical University and Northeastern University, outlines how these smart dressings combine real-time physiological signal detection with artificial intelligence, offering a new paradigm in personalized wound care.

Why it matters:

  • Real-time monitoring: Conductive hydrogels can track key wound parameters such as temperature, pH, glucose levels, pressure, and even pain signals-providing continuous, non-invasive insights into wound status.
  • AI-driven analysis: Machine learning algorithms (e.g., CNN, KNN, ANN) process sensor data to predict healing stages, detect infections early, and guide treatment decisions with high accuracy (up to 96%).
  • Multifunctional integration: These dressings not only monitor but also actively promote healing through electroactivity, antibacterial properties, and drug release capabilities.

Key features:

  • Material innovation: The review discusses various conductive materials (e.g., CNTs, graphene, MXenes, conductive polymers) and their roles in enhancing biocompatibility, sensitivity, and stability.
  • Smart signal output: Different sensing mechanisms-such as colorimetry, resistance variation, and infrared imaging-enable multimodal monitoring tailored to wound types.
  • Clinical applications: The paper highlights applications in pressure ulcers, diabetic foot ulcers, and joint wounds, emphasizing the potential for home care, remote monitoring, and early intervention.

Challenges & future outlook:

Despite promising advances, issues such as material degradation, signal stability, and AI model generalizability remain. Future efforts will focus on multidimensional signal fusion, algorithm optimization, and clinical translation to bring these intelligent dressings into mainstream healthcare.

This work paves the way for next-generation wound care, where smart materials meet smart algorithms-offering hope for millions suffering from chronic wounds.

Stay tuned for more innovations at the intersection of biomaterials, AI, and personalized medicine!

Source:

Journal reference:

She, Y., et al. (2025). Artificial Intelligence-Assisted Conductive Hydrogel Dressings for Refractory Wounds Monitoring. Nano-Micro Letters. doi.org/10.1007/s40820-025-01834-w



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To ChatGPT or not to ChatGPT: Professors grapple with AI in the classroom

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As shopping period settles, students may notice a new addition to many syllabi: an artificial intelligence policy. As one of his first initiatives as associate provost for artificial intelligence, Michael Littman PhD’96 encouraged professors to implement guidelines for the use of AI. 

Littman also recommended that professors “discuss (their) expectations in class” and “think about (their) stance around the use of AI,” he wrote in an Aug. 20 letter to faculty. But, professors on campus have applied this advice in different ways, reflecting the range of attitudes towards AI.

In her nonfiction classes, Associate Teaching Professor of English Kate Schapira MFA’06 prohibits AI usage entirely. 

“I teach nonfiction because evidence … clarity and specificity are important to me,” she said. AI threatens these principles at a time “when they are especially culturally devalued” nationally.

She added that an overreliance on AI goes beyond the classroom. “It can get someone fired. It can screw up someone’s medication dosage. It can cause someone to believe that they have justification to harm themselves or another person,” she said.

Nancy Khalek, an associate professor of religious studies and history, said she is intentionally designing assignments that are not suitable for AI usage. Instead, she wants students “to engage in reflective assignments, for which things like ChatGPT and the like are not particularly useful or appropriate.”

Khalek said she considers herself an “AI skeptic” — while she acknowledged the tool’s potential, she expressed opposition to “the anti-human aspects of some of these technologies.”

But AI policies vary within and across departments. 

Professors “are really struggling with how to create good AI policies, knowing that AI is here to stay, but also valuing some of the intermediate steps that it takes for a student to gain knowledge,” said Aisling Dugan PhD’07, associate teaching professor of biology.

In her class, BIOL 0530: “Principles of Immunology,” Dugan said she allows students to choose to use artificial intelligence for some assignments, but that she requires students to critique their own AI-generated work. 

She said this reflection “is a skill that I think we’ll be using more and more of.”

Dugan added that she thinks AI can serve as a “study buddy” for students. She has been working with her teaching assistants to develop an AI chatbot for her classes, which she hopes will eventually answer student questions and supplement the study videos made by her TAs.

Despite this, Dugan still shared concerns over AI in classrooms. “It kind of misses the mark sometimes,” she said, “so it’s not as good as talking to a scientist.”

For some assignments, like primary literature readings, she has a firm no-AI policy, noting that comprehending primary literature is “a major pedagogical tool in upper-level biology courses.”

“There’s just some things that you have to do yourself,” Dugan said. “It (would be) like trying to learn how to ride a bike from AI.”

Assistant Professor of the Practice of Computer Science Eric Ewing PhD’24 is also trying to strike a balance between how AI can support and inhibit student learning. 

This semester, his courses, CSCI 0410: “Foundations of AI and Machine Learning” and CSCI 1470: “Deep Learning,” heavily focus on artificial intelligence. He said assignments are no longer “measuring the same things,” since “we know students are using AI.”

While he does not allow students to use AI on homework, his classes offer projects that allow them “full rein” use of AI. This way, he said, “students are hopefully still getting exposure to these tools, but also meeting our learning objectives.”

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Ewing also added that the skills required of graduated students are shifting — the growing presence of AI in the professional world requires a different toolkit.

He believes students in upper level computer science classes should be allowed to use AI in their coding assignments. “If you don’t use AI at the moment, you’re behind everybody else who’s using it,” he said. 

Ewing says that he identifies AI policy violations through code similarity — last semester, he found that 25 students had similarly structured code. Ultimately, 22 of those 25 admitted to AI usage.

Littman also provided guidance to professors on how to identify the dishonest use of AI, noting various detection tools. 

“I personally don’t trust any of these tools,” Littman said. In his introductory letter, he also advised faculty not to be “overly reliant on automated detection tools.” 

Although she does not use detection tools, Schapira provides specific reasons in her syllabi to not use AI in order to convince students to comply with her policy. 

“If you’re in this class because you want to get better at writing — whatever “better” means to you — those tools won’t help you learn that,” her syllabus reads. “It wastes water and energy, pollutes heavily, is vulnerable to inaccuracies and amplifies bias.”

In addition to these environmental concerns, Dugan was also concerned about the ethical implications of AI technology. 

Khalek also expressed her concerns “about the increasingly documented mental health effects of tools like ChatGPT and other LLM-based apps.” In her course, she discussed with students how engaging with AI can “resonate emotionally and linguistically, and thus impact our sense of self in a profound way.”

Students in Schapira’s class can also present “collective demands” if they find the structure of her course overwhelming. “The solution to the problem of too much to do is not to use an AI tool. That means you’re doing nothing. It’s to change your conditions and situations with the people around you,” she said.

“There are ways to not need (AI),” Schapira continued. “Because of the flaws that (it has) and because of the damage (it) can do, I think finding those ways is worth it.”



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This Artificial Intelligence (AI) Stock Could Outperform Nvidia by 2030

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When investors think about artificial intelligence (AI) and the chips powering this technology, one company tends to dominate the conversation: Nvidia (NASDAQ: NVDA). It has become an undisputed barometer for AI adoption, riding the wave with its industry-leading GPUs and the sticky ecosystem of its CUDA software that keep developers in its orbit. Since the launch of ChatGPT about three years ago, Nvidia stock has surged nearly tenfold.

Here’s the twist: While Nvidia commands the spotlight today, it may be Taiwan Semiconductor Manufacturing (NYSE: TSM) that holds the real keys to growth as we look toward the next decade. Below, I’ll unpack why Taiwan Semi — or TSMC, as it’s often called — isn’t just riding the AI wave, but rather is building the foundation that brings the industry to life.

What makes Taiwan Semi so critical is its role as the backbone of the semiconductor ecosystem. Its foundry operations serve as the lifeblood of the industry, transforming complex chip designs into the physical processors that power myriad generative AI applications.

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