Artificial intelligence is no longer confined to research labs or Silicon Valley startups. It’s increasingly shaping how capital markets function. The latest example: FINQ, a next-generation fintech company founded by Eldad Tamir and backed by Palo Alto Networks’ founder Nir Zuk, has filed with the U.S. Securities and Exchange Commission to launch two new AI-managed large-cap exchange-traded funds (ETFs), in partnership with Tidal Investments LLC, the funds’ adviser, with FINQ AI LLC serving as sub-adviser.
The proposed funds are the FINQ FIRST U.S. Large Cap AI-Managed Equity ETF (proposed ticker: AIUP) and the FINQ DOLLAR NEUTRAL U.S. Large Cap AI-Managed Equity ETF (proposed ticker: AINT). They are designed to bring sophisticated, technology-driven strategies into the portfolios of ordinary investors. The funds are expected to be listed on a national securities exchange following the effectiveness of the registration statement and subject to applicable approvals.
Redefining Active Management
Traditional active management relies on teams of portfolio managers and analysts who interpret market signals. FINQ’s approach shifts that responsibility to its proprietary AI model, which recalibrates daily rankings of every stock in the S&P 500 index.
- AIUP takes long positions in stocks that the model ranks highest.
- AINT balances long positions in top-ranked stocks with short positions in those ranked lowest, aiming to minimize exposure to overall market swings.
Tamir frames the launch as part of a larger effort to modernize asset management. He says, “Our goal is to bring advanced AI capabilities to investors in a transparent, rules-based structure. These ETFs are designed to challenge conventional thinking by using technology to remove noise and uncover relative performance insights on a continuous basis.”
Riding Two Waves: ETFs and AI
FINQ’s filings come at a time when both ETFs and AI are experiencing explosive growth. According to ETFGI, assets in the global ETFs industry reached approximately $10.33 trillion at the end of 2024. Meanwhile, Deloitte estimates that AI in financial services could generate more than $300 billion in value annually by 2030, as firms seek to harness its predictive and analytical capabilities.
Asset managers are racing to integrate AI into their workflows. A CFA Institute report notes that 64% of investment professionals are pursuing or plan to pursue skills development in AI and machine learning, a sign of how rapidly the technology is being adopted across the industry. FINQ’s move brings that trend directly into a publicly listed product.
Transparency as Differentiation
One of the challenges with AI in finance is the “black box” effect, or models that produce results without offering visibility into how they arrived at those results. By embedding its system in an ETF, FINQ is betting that transparency will help ease skepticism. Investors will be able to see holdings, performance, and adjustments within a structure that regulators already monitor closely.
This could prove crucial as AI adoption accelerates. PwC has highlighted that trust and the explainability of AI decisions remain critical challenges, particularly due to the “black-box” nature of many models and the risk of bias, which can undermine confidence in high-stakes contexts. FINQ’s approach aims to strike a balance between cutting-edge technology and the need for investor trust.
Risks Still Loom
Of course, the model-driven structure is not without downsides. The prospectus flags the possibility of high turnover, which could inflate trading costs. The ETFs’ non-diversified nature may increase exposure to single companies or sectors. And as with any machine learning–driven product, accuracy is only as strong as the underlying data.
Such risks reflect a broader truth about AI in markets: while the potential for enhanced efficiency is real, the margin for error remains narrow.
Beyond Technology Stocks
For years, “AI investing” has often meant buying shares of companies building chips, cloud platforms, or machine learning applications. FINQ’s launch suggests a new chapter where AI is the driver behind how capital is allocated across the market.
If the funds succeed, they could set a precedent for how advanced analytics enter the retail investment mainstream. For investors, that could mean a future where AI isn’t just powering back-office decisions, but shaping their portfolios in real time.
Read the original company press release for full disclosure.
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This content has been provided by FinQ AI LLC and is published as received. FinQ AI LLC is solely responsible for the information contained herein, including its accuracy and completeness.
This press release is for informational purposes only and does not constitute financial advice or an endorsement of any product or service. Readers should conduct their own research and consult a licensed financial advisor before making investment decisions.