1 No-Brainer Artificial Intelligence (AI) Index Fund to Buy Right Now for Less Than $1,000

There hasn't been a more notable trend in markets and the economy in recent years than the artificial intelligence (AI) craze. This technology is being seen as a game changer that could fundamentally alter society, with huge gains in productivity that will lead to incredible economic growth. Businesses are investing hundreds of billions of dollars to be leaders in the space, and governments are supporting this activity.

Investors should always be looking for ways to better position their portfolios for long-term capital appreciation. Therefore, it makes sense to allocate some money to AI if that's a top priority. And there is a diversified way to gain exposure to this trend.

Investors who want to buy a top AI index fund right now for less than $1,000 are in luck. There's a booming exchange-traded fund (ETF) that costs $623 at the current price -- well below that maximum cash outlay.

Investors can easily invest in AI growth

You might think that you need to be able to pick individual stocks that can be winners in the AI race, but this simply isn't true. Large investment firms offer products like ETFs that can be just what investors need in their portfolios. And when it comes to a no-brainer AI index fund, the Invesco QQQ Trust (NASDAQ: QQQ) is a leading choice.

This ETF tracks the performance of the 100 biggest non-financial companies that trade on the Nasdaq exchange. This is a much different choice than the S&P 500, whose stocks can be viewed as a barometer of how the overall stock market and U.S. economy are doing.

Even though there are 100 businesses in the Invesco QQQ Trust, investors should understand that there is concentration at the top. The largest position is Nvidia, the $4.4 trillion enterprise that has been the major AI winner thus far. Then there's Apple and Microsoft. Combined, these top three stocks make up 25% of the entire Invesco QQQ Trust.

This ETF clearly provides exposure to companies that are at the cutting edge of various technological shifts. Besides AI, other secular trends that investors will benefit from by owning the Invesco QQQ Trust are cloud computing, digital payments, streaming entertainment, digital advertising, and autonomous driving. Any investor who wants to bet on technology continuing to be a driving force in the economy will like what this ETF offers.

Will this ETF maintain its impressive performance?

The Invesco QQQ Trust has been a wonderful portfolio addition recently. Over the past decade, it has generated a total return of 497% (as of Dec. 11). This would have turned a starting $10,000 investment into almost $60,000 today -- a phenomenal gain.

Investors will appreciate the low costs, with its expense ratio of 0.2%. This means that for every $10,000 purchase in the Invesco QQQ Trust, just $20 goes to management fees to cover its operating expenses. Given its amazing past performance, this is a reasonable price to pay, in my view, especially when compared to the exorbitant fees charged by active money managers.

It's impossible to predict how this ETF will perform over the next decade and beyond, although it's valid to assume that returns will come down. But investors can look at factors that will keep working in their favor, like capital flows from retail investors, accommodative central bank actions, rising corporate earnings, and ongoing innovation. These tailwinds make the Invesco QQQ Trust a smart choice.

Neil Patel has positions in Invesco QQQ Trust. The Motley Fool has positions in and recommends Apple, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.