You may already own more AI than you think: about 25% of VGS and 34% of IVV sits in NVIDIA, Apple, Microsoft, Alphabet, Amazon, Meta and Broadcom. Stepping up to NDQ (37%) or FANG (70%) concentrates that bet. Dedicated funds like SEMI (+109% in the year to 30 September 2026) and GXAI (+24.8%) go further still, for higher fees and much bigger swings.
Step 1: check how much AI you already own
The companies at the centre of artificial intelligence, the chip makers, cloud providers and software giants, are now the largest companies in the world. Index funds weight by size, so any broad global or US fund already holds plenty of them.
How much of each fund is the seven AI giants
- Australian shares ETFs such as VAS hold essentially none. The ASX has very few large technology companies.
- VGS is about 30% technology, and its top four holdings are NVIDIA, Apple, Microsoft and Alphabet.
- IVV is even more concentrated, at about 37% technology for a fee of just 0.04%.
So if your portfolio is, say, half Australian shares and half VGS, roughly an eighth of everything you own is already riding the AI giants. That is not a reason to avoid more, but it is the starting point.
See how much of NDQ you already own through VGS →
Step 2: decide how big a bet you want
Think of AI exposure as a ladder. Each rung concentrates more of your money in fewer companies, raises the fee and widens the swings.
| Rung | Example ETFs | Fee | 1 year | 5 years (a year) | What you get |
|---|---|---|---|---|---|
| 1. Broad market | IVV, VGS | 0.04 to 0.18% | +10.1% | +11.8 to 13.4% | AI giants plus the rest of the market |
| 2. Big tech | NDQ, VTEK | 0.23 to 0.48% | +16.6% (NDQ) | +15.3% (NDQ) | The largest tech and growth companies |
| 3. Concentrated | FANG | 0.35% | +10.6% | +20.9% | Ten giants, about 10% each |
| 4. Pure AI themes | SEMI, GXAI, AINF | 0.45 to 0.57% | +24.8 to +109.0% | +35.2% (SEMI) | Chips, AI software, AI infrastructure |
Total returns to 30 September 2026; 5-year figures per year. GXAI and AINF are under three years old. Source: TMX Australia monthly funds report.
What $10,000 grew to over five years
Over five years the higher rungs paid off handsomely. But that is exactly the period in which AI went from a promise to the market's main story. The same concentration that lifted SEMI 352% in five years would work just as hard in reverse.
Step 3: understand what each AI fund really holds
- NDQ ($9.5 billion) holds the 100 largest non-financial Nasdaq companies. It is about 58% technology, with Apple, NVIDIA and Microsoft at the top. It is the most popular way Australians buy US tech.
- FANG holds just ten companies in roughly equal weights, including Palantir, Microsoft, Apple, Broadcom, Micron and NVIDIA. Simple, cheap at 0.35%, and highly concentrated.
- SEMI holds 30 chip companies: NVIDIA, Micron, TSMC, AMD and Broadcom are each about 10%. It more than doubled over the past year, second only to the South Korea fund IKO among all ASX ETFs.
- GXAI holds about 90 companies developing and using AI, led by Palantir, Microsoft, Tesla and Oracle. Smaller weights spread the risk, but 43% of it is already in NDQ.
- AINF takes a different route: power utilities, copper miners and network equipment that data centres need. It shares almost nothing with NDQ.
How much each AI fund doubles up on what you own
Compare the popular pairs: NDQ vs FANG, IVV vs NDQ, VGS vs SEMI and NDQ vs HNDQ (the currency hedged version).
Step 4: count the cost
What fees cost on $100,000 over 20 years
Fees are the one part of the return you can be sure of. GXAI costs about 14 times as much as IVV each year. That can be worth it for a focused exposure you cannot get elsewhere, but it is a high price to pay for companies you already own through a cheap index fund.
Step 5: size it as a satellite
A common approach is core and satellite: a large, low-cost core of broad Australian and global shares, and a few smaller satellite positions for themes you believe in. For AI, that might look like this:
- Light touch: stay with VGS or IVV and accept the AI exposure they already carry. Suits investors who want market returns and low fees.
- Moderate: add NDQ or FANG as 5 to 15% of your shares. Suits investors who want a tilt to big tech, accepting heavier US and tech concentration.
- Focused: add a small slice, often 2 to 5%, of SEMI, GXAI or AINF. Suits investors with a strong view and the patience to hold through 30 to 50% falls.
For investors nearing or in retirement, it is worth remembering that a large tech fall early in retirement can do lasting damage when you are drawing an income. Our guide to building a satellite portfolio covers sizing in more detail.
Risks worth weighing
- Concentration. A handful of US companies drive most AI funds. If spending on AI data centres slows, they are likely to fall together.
- Valuations. Strong past returns mean high expectations are already in the price.
- Currency. Most AI ETFs are unhedged; a rising Australian dollar trims returns. NDQ has a hedged twin, HNDQ.
- New funds. Several AI ETFs are under three years old, so there is little history through a downturn.
Want to go beyond the chip and software makers? The AI boom goes beyond NDQ maps every ASX ETF across the AI supply chain, from copper and uranium to robotics and cybersecurity. Or browse the AI and robotics ETFs and technology ETFs pages.
Common questions
What is the best AI ETF in Australia?
It depends on how focused you want to be. SEMI (chips) had the strongest record, up 109% in the year to 30 September 2026 and 35% a year over five years. GXAI is the broadest pure AI fund. NDQ and FANG give big tech exposure at lower fees.
Does VGS give me AI exposure?
Yes. About a quarter of VGS is in NVIDIA, Apple, Microsoft, Alphabet, Amazon, Meta and Broadcom, and about 30% is technology overall.
Is NDQ an AI ETF?
Not officially, but it is about 58% technology and its biggest holdings are the AI leaders. It overlaps with the pure AI fund GXAI by about 43%.
How much of my portfolio should be in AI ETFs?
There is no single right answer. Many investors keep themes as small satellites, often 2 to 15% combined, beside a diversified core. The right size depends on your goals, timeframe and how you would cope with a large fall.
Joshua Stega is a financial adviser with 20 years' experience and the founder of ETF Adviser. He built ReviewETF to make every Australian ETF easy to find and compare.
General information only. It does not take into account your objectives, financial situation or needs. Consider the PDS and TMD before investing. Past performance is not a reliable indicator of future performance. Data as at 30 September 2026.