Vulcan Stock Research

A comprehensive comparison of three new AI-focused ETFs for retail investors

The artificial intelligence investing boom has spawned a new generation of specialized ETFs, each promising to capture the AI revolution in their own unique way. Three funds launched within the past year stand out: BlackRock’s BAI, Tom Lee’s GRNY, and Dan Ives’ IVES.

But which one should you actually buy? Let’s break down the key differences to help you decide.

Meet the Contenders

BAI (iShares AI Innovation & Tech Active) – BlackRock’s premium offering

• Launched: October 21, 2024
• Expense Ratio: 0.55% (lowest of the three)
• Strategy: Active global stock-picking by BlackRock managers
• Holdings: 41 companies with heavy mega-cap concentration

GRNY (Fundstrat Granny Shots) – Tom Lee’s tactical approach

• Launched: October 31, 2024
• Expense Ratio: 0.75%
• Strategy: Equal-weighted quarterly rebalancing of AI themes
• Holdings: ~38 companies, completely rebalanced every three months

IVES (Dan Ives Wedbush AI Revolution) – The rules-based option

• Launched: June 3, 2025
• Expense Ratio: 0.75%
• Strategy: Static 30-stock index rebalanced twice yearly
• Holdings: 30 companies split between AI infrastructure and applications

The Numbers That Matter

Feature	BAI	GRNY	IVES
Expense Ratio	0.55%	0.75%	0.75%
Assets Under Management	~$1.0B	~$2.0B	$417M
Number of Holdings	41	38	30
Top 10 Concentration	51%	32%	50%
Rebalancing	As needed	Every quarter	Twice yearly

How They Pick Stocks

BAI: The Active Approach BlackRock’s portfolio managers have free rein to chase what they see as the best AI opportunities globally. This means they can heavily weight winners like NVIDIA (10% of the fund) and adjust positions as they see fit. The downside? You’re paying for active management and betting on the managers’ stock-picking skills.

GRNY: The Disciplined Rotator Tom Lee’s fund takes a unique approach by equal-weighting all positions (around 2.8% each) and completely reshuffling the portfolio every three months. This prevents any single stock from dominating while forcing the fund to sell winners and buy laggards regularly. It’s like having a disciplined rebalancing robot.

IVES: The Set-It-and-Forget-It Option This fund simply tracks an index of 30 AI companies chosen by analyst Dan Ives. Two-thirds focus on hardware/infrastructure (NVIDIA, Broadcom, AMD), while one-third covers software/applications (Microsoft, Oracle, Apple). Rebalancing happens just twice a year, so you get pure AI exposure without constant tinkering.

Portfolio Concentration: A Tale of Three Strategies

Here’s where the differences really show:

BAI’s Top 5 Holdings:

1. NVIDIA (10.0%)
2. Broadcom (7.9%)
3. Meta (6.6%)
4. Microsoft (6.4%)
5. Oracle (4.5%)

GRNY’s Top 5 Holdings:

1. Robinhood (3.9%)
2. AMD (3.7%)
3. Oracle (3.6%)
4. GE Vernova (3.5%)
5. NVIDIA (3.2%)

IVES’ Top 5 Holdings:

1. NVIDIA (5.75%)
2. Oracle (5.40%)
3. Taiwan Semiconductor (5.19%)
4. Microsoft (5.11%)
5. Broadcom (5.10%)

Notice how GRNY’s equal-weighting keeps individual positions much smaller, while BAI and IVES let their top holdings run higher.

Risk and Return So Far

Volatility (how bumpy the ride is):

• IVES: ~28% annualized (highest)
• BAI: ~25% annualized
• GRNY: ~23% annualized (lowest)

Year-to-Date Returns:

• GRNY: 17.6%
• BAI: 15.4%
• IVES: 8.3% (but only two months of data)

Keep in mind these are all relatively new funds, so performance data is limited. All three move closely with the broader market—they’re amplifiers of tech trends, not hedges against them.

Cost Analysis: More Than Just Expense Ratios

While BAI has the lowest expense ratio at 0.55%, there are other costs to consider:

Trading Spreads (what you pay to buy/sell):

• BAI: 2-3 cents (tightest)
• GRNY: 4-5 cents
• IVES: 6-8 cents (widest, due to being newest)

Liquidity (daily trading volume):

• GRNY: 530,000 shares/day (highest)
• BAI: 410,000 shares/day
• IVES: 220,000 shares/day (lowest)

Which ETF Is Right for You?

Choose BAI if:

• You want the lowest ongoing costs (0.55% expense ratio)
• You trust BlackRock’s active management approach
• You’re comfortable with concentrated positions in mega-cap AI stocks
• You want global exposure (includes Taiwan Semiconductor, international names)

Choose GRNY if:

• You like the discipline of quarterly rebalancing
• You want equal-weighting to limit single-stock risk
• You appreciate the broader theme approach beyond just pure AI plays
• You don’t mind paying 0.75% for tactical positioning

Choose IVES if:

• You prefer a transparent, rules-based approach
• You want pure AI exposure without manager discretion
• You’re comfortable with higher concentration and volatility
• You can tolerate wider bid-ask spreads while the fund grows

The Risks You Need to Know

All Three Share These Risks:

• Heavy exposure to expensive growth stocks vulnerable to rising interest rates
• High correlation with big tech means limited diversification benefits
• Concentration in AI theme could face sudden rotation out of favor

Specific Risks:

• BAI: Manager risk – performance depends on BlackRock’s stock-picking ability
• GRNY: Rebalancing whiplash – forced quarterly selling could create tax events and miss momentum
• IVES: Liquidity concerns – lowest trading volume could mean higher transaction costs

Our Bottom Line

For most retail investors, GRNY offers the best balance of disciplined rebalancing, reasonable diversification, and proven liquidity. The quarterly equal-weighting approach removes emotional decision-making while the broader theme exposure provides some cushion beyond pure AI plays.

BAI makes sense if you’re cost-conscious and believe in active management, while IVES works best as a tactical satellite position for investors who want pure, concentrated AI exposure.

Remember: these are all high-risk, high-reward bets on a single theme. Consider them as satellites to a diversified core portfolio, not as your primary equity exposure.

None of this constitutes personalized investment advice. Always consult with a qualified financial advisor and carefully read fund prospectuses before investing.