The world of hedge fund investing has seen a significant shift in focus with the rise of artificial intelligence (AI). Ivana Delevska, a veteran in the industry, recognized the potential of AI early on and leveraged her experience at top firms to launch her own fund in August 2021.
Delevska’s expertise in the industrial sector allowed her to identify the growing importance of AI in company investments. By closely monitoring where companies were allocating their resources, she was able to foresee the AI boom before many others. This foresight led to the creation of the Spear Alpha ETF, which now boasts $70 million in assets under management and has outperformed well-known competitors like the Ark Innovation ETF.
One of the key components of Spear Alpha ETF’s success is its strategic investment in companies at the forefront of AI development. Nvidia, a leading provider of graphics processing units, has been a standout performer in the fund’s portfolio. Despite being undervalued in 2023, Delevska recognized the potential for high returns and strategically positioned Nvidia as a core holding. This bold move paid off as Nvidia’s stock soared over 220% in the past year, solidifying its role as a defensive asset with promising future returns.
While AI remains a dominant theme in Spear Alpha ETF, Delevska has also diversified the fund’s portfolio to include other innovative sectors such as enterprise digitalization, space exploration, and decarbonization. However, she emphasizes that the fund’s approach is not strictly thematic but rather driven by the individual companies it covers. This approach mirrors the practices of top hedge funds like Citadel, where stock selection is paramount in generating alpha.
Despite being a relatively new player in the hedge fund world, Spear Alpha ETF has seen significant inflows, attracting $54 million in investments in 2024. In contrast, industry titan Cathie Wood has experienced outflows of $1.36 billion from her ARKK fund as investors grew disillusioned with its performance. This trend underscores the growing interest in AI-focused investing and the recognition of innovative strategies like Delevska’s.
The rise of artificial intelligence in hedge fund investing represents a paradigm shift in how investors approach portfolio management. By leveraging AI’s potential, innovative thinkers like Ivana Delevska are reshaping the industry and achieving impressive returns for their clients. As technology continues to drive market trends, it is clear that AI will play an increasingly vital role in shaping the future of hedge fund investing.