Mottarelli (Dws): “Artificial intelligence will increase companies’ turnover and profits”

The theme of artificial intelligence (AI), which dominated the markets in 2023 and in this first part of 2024, is not destined to fade away so quickly. He is convinced of this Andrea Mottarelli, country head of Dws Italywhich tries to outline its future developments both from a stock market and corporate application point of view.

Can artificial intelligence give new impetus to the markets?

“With the launch of the voice chatbot ChatGpt, which took place about a year ago, the topic of generative artificial intelligence has also seen a new push on the stock markets. The prospects and growth of this trend can also be interesting for investors, for whom we have developed Dws Invest Artificial Intelligence, a fund that invests globally in companies whose business can benefit from developments in artificial intelligence.”

With the opening of ChatGpt to the general public, generative AI experienced an extraordinary surge, even on the stock market. What drives investors?

“ChatGpt has definitely sparked the imagination because now we can see what generative AI is capable of. It can instantly create images, write text and code software. These are capabilities that we have never seen before and that open up completely new possibilities. Furthermore, in recent months we have seen that AI can actually have a positive impact on company fundamentals, because sales and profits are growing faster than previously thought.”

Which sectors are currently benefiting the most from the AI ​​boom?

“First of all, there are companies that collect data or have proprietary data. Second, there are the companies that provide the computing power needed to train and run AI models. The third area is that of users, i.e. companies from various sectors that use AI in different ways and can thus increase their business growth”.

How is the Dws Invest Artificial Intelligence investment process structured?

“Our fund is based on two pillars of analysis. First, we carefully evaluate whether a company is benefiting from AI trends. We particularly look for companies whose products cannot be easily reproduced by competitors. It is important that the company can grow faster than the market. And that AI contributes significantly to sales, profits and, of course, the stock price. Secondly, of course, there is fundamental analysis which remains important. The combination of the two pillars leads us to decide whether or not a company is suitable for our portfolio.”

Where do you think AI can have the biggest impact in the future?

“Users are an important pillar of our portfolio and that is why we are also looking at many industries outside of the technology sector. The two most interesting areas at the moment are probably medicine and transportation. In the healthcare sector, it is increasingly clear that artificial intelligence will help significantly reduce drug development times and costs. And in the transportation sector, autonomous driving is about to make a breakthrough. We can expect many changes in the future.”

In which regions do you expect the greatest AI-driven developments to occur in the near future?

“The United States is obviously still in an advantageous position, especially when it comes to semiconductor technology, compared to China which however retains great potential and will certainly continue to expand its position. The Chinese have set themselves the goal of becoming the world leader in artificial intelligence by 2030 and are strongly encouraging its development. Every year, thousands of scientists leave universities to work full-time on AI across the value chain. Furthermore, the Chinese are in an ideal position when it comes to data. Just think of how many internet users there are in China: more than in the United States and Europe combined.”

And Europe?

“Although the Old Continent lacks an ecosystem like that of Silicon Valley with companies, scientists and investors all concentrated in one place, although less widespread there are virtuous examples of companies that are establishing themselves in the AI ​​sector also in Europe. For this reason, but also to ensure the greatest possible global diversification, we also find several European companies in the portfolio, with a weight of more than 7%”.