Bank of America analysis shows that fund managers’ love for artificial intelligence-related stocks is growing as many technology companies become important holdings in their portfolios. The Wall Street firm looked at the holdings of actively managed U.S. large-cap mutual funds. It screens for stocks in the S&P 500 that have seen the largest increases in ownership breadth over the past 12 months (as measured by the percentage of funds that own each name). Bank of America found that 9 out of 10 stocks on its list are related to the artificial intelligence craze. The exception is Eli Lilly, which has benefited from the rise of weight-loss drugs. “What are your neighbors doing? Buying artificial intelligence,” Bank of America strategists led by Savita Subramanian said in a note. “AI stocks are now core holdings.” Fund holdings in Broadcom have increased over the past year The largest increase was seen, with 45% of active managers holding the stock as of April. The chipmaker issued upbeat guidance in March, saying it expected revenue from artificial intelligence chips to hit $10 billion this year. Other chip manufacturers on the list include Arista Networks, Applied Materials and Nvidia. Nvidia is the clear winner in artificial intelligence, with its stock price doubling again in 2024. Meta Platforms, Uber Technologies, Netflix and ServiceNow have also grown in popularity among active managers, according to Bank of America. The Wall Street firm said changes in fund manager ownership are positively correlated with the number of times “artificial intelligence” is mentioned on earnings calls.
