When it comes to disruptive growth concepts, also known as megatrends, investors frequently focus on these technologies in singular fashion. However, one of the more alluring factors in innovative growth investing is that many of these industries intersect with each other.
That adds to their long-term growth prospects. Prime examples include artificial intelligence (AI) and biotechnology/genomics. Those themes are accessible via exchange traded funds, including the WisdomTree Artificial Intelligence and innovation Fund (WTAI) and the WisdomTree BioRevolution Fund (WDNA).
The coronavirus pandemic, including the Omicron variant, highlight the utility of AI’s applications in the disruptive healthcare arena.
“Scientists use well-known procedures to reveal the three-dimensional structures of proteins, including electron microscopes. The concept is that if you could see how the coronaviruses bind with and enter human cells, then you can learn about and make an initial assessment about the effectiveness of a given vaccine,” says Christopher Gannatti, WisdomTree global head of research. “The often mentioned ‘spike protein’ is critical in the binding process, thereby lending the intuition that if mutations cause significant changes to the spike protein, it could be more problematic for existing treatments.”
The usage case for AI in the genomics space is vibrant and vital, as it can play pivotal roles in reducing costs for technologies such as CRISPR, early cancer screening, and gene editing, among others. There are also myriad genomics applications for AI software. Take the case of DeepMind’s software known has Alphafold.
“The interesting point is that neither software package was originally designed to predict small changes in structure that would be apparent from mutations of an existing virus, and yet the results were still helpful,” adds Gannatti. “Instead of just waiting for the physical material and having no options, scientists have the power to make a well-educated guess that can be confirmed with the more traditional techniques.”
Ultimately, the AI/genomics scenario is just one example of disruptive technologies intersecting with each other, but it’s a noteworthy one that offers investors a compelling long-term growth trajectory.
“AI becomes less abstract, as we see examples of data, predictions and the value of those predictions all coming together. The BioRevolution, in particular when human health is at stake, is very tangible, especially during a global pandemic,” concludes Gannatti.
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