Which Is the Better Artificial Intelligence (AI) ETF, Roundhill's CHAT or State Street's XLK?
Written by Robert Izquierdo for The Motley Fool -> The State Street Technology Select Sector SPDR ETF has a lower expense ratio and higher assets under management than the Roundhill Investments Generative AI & Technology ETF. The Roundhill Investments Generative AI & Technology
The State Street Technology Select Sector SPDR ETF has a lower expense ratio and higher assets under management than the Roundhill Investments Generative AI & Technology ETF.
The Roundhill Investments Generative AI & Technology ETF offers a higher trailing-12-month dividend payout but exhibits greater price volatility relative to the broader market.
The Roundhill Investments Generative AI & Technology ETF provides actively managed exposure to generative AI companies, while the State Street Technology Select Sector SPDR ETF tracks a passive index of technology companies within the S&P 500.
Comparing the Roundhill Investments Generative AI & Technology ETF (NYSEMKT:CHAT) and State Street Technology Select Sector SPDR ETF (NYSEMKT:XLK) involves weighing the high-growth potential of niche generative artificial intelligence stocks against established technology giants at a lower cost.
Investors seeking technology exposure often choose between broad sector plays and targeted thematic funds. CHAT offers an actively managed approach to the emerging generative artificial intelligence space, while XLK provides passive exposure to the largest technology companies within the S&P 500. This comparison highlights their divergent strategies and risk profiles.
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The One-year return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
Cost-conscious investors may prefer the State Street fund, which features a notably lower expense ratio. However, the Roundhill fund offers a higher payout, having distributed $1.68 per share over the trailing 12 months compared to $0.76 for its peer, representing a 1.32 percentage point yield gap.
The State Street Technology Select Sector SPDR ETF provides targeted exposure to companies within the Technology Select Sector Index. This passive strategy focuses entirely on the technology sector of the S&P 500, including companies in software, hardware, and semiconductor industries. Its largest positions include Nvidia (NASDAQ:NVDA) at 13.30%, Apple (NASDAQ:AAPL) at 11.37%, and Microsoft (NASDAQ:MSFT) at 8.05%. Launched in 1998, it has a trailing-12-month dividend of $0.76 per share and holds 72 positions, with its last ex-dividend date occurring on March 23, 2026.
