Is your index fund an accidental bet on AI? These two massive ETFs show why it might be.

The recent surge in artificial intelligence has led to a significant shift in the composition of emerging-markets funds, with South Korean stocks now playing a much larger role. This is particularly evident in two massive ETFs, which have seen their allocations to South Korean stocks increase substantially. As a result, investors who hold these funds may be inadvertently betting on the success of AI-related companies, even if that was not their intention.

The reason for this shift is the growing importance of AI in the global economy, and the key role that South Korean companies are playing in this space. Many of these companies are major players in the technology sector, and their stocks have been boosted by the increasing demand for AI-related products and services. This has led to a reweighting of emerging-markets funds, with South Korean stocks now making up a larger proportion of these funds than they did in the past.

As the AI trend continues to gather momentum, it will be important for fund investors to be aware of the potential implications for their portfolios. They should monitor the composition of their funds and consider whether their investments are aligned with their overall investment goals. Additionally, investors should watch for further shifts in the global economy and the technology sector, as these could have a significant impact on the performance of emerging-markets funds and the companies they hold.

Originally reported by marketwatch.com. FundNews adds analysis for finance & markets readers.