Super funds are investing billions in AI-related assets as the technology sector continues to drive gains in global share markets. New data indicates that many of Australia’s top ten superannuation providers have allocated around 10% of their most popular investment plans to companies involved with artificial intelligence. This reflects growing confidence in AI's potential to transform industries, though it also raises concerns about the risks in members' portfolios.
At present, investment in AI by super funds is accelerating as major global tech companies expand their AI capabilities. Analysis of nearly 300 portfolios shows that at least $143 billion has been invested in businesses benefiting from AI trends. These include not only well-known public companies but also private and unlisted firms operating in the AI space, which highlights the broad scope of exposure.
Much of this investment is focused on companies such as Microsoft, Nvidia and Alphabet, which are leading developments in artificial intelligence. These companies, often grouped with others as the “magnificent seven,” have driven significant gains in market indices and reshaped the global investment environment. Retail-focused super funds, which have greater exposure to international equities, have outperformed others largely due to this AI-driven rally.
A wider structural shift is also underway. As Australia’s $4.3 trillion superannuation market reaches maturity, fund managers are turning more to international markets and emerging technologies in search of higher returns. With traditional sectors like mining and financial services delivering more modest results, AI presents a compelling alternative for growth-oriented portfolios.
However, experts warn that AI is not a guaranteed path to higher returns. While some view it as a major force in the next economic era, others are concerned it may resemble past technology bubbles. The long-term outcome will depend on whether future innovation and earnings can justify the high valuations seen today.
Investment in AI has the potential to deliver significant gains, but also notable losses. Like any growth-focused asset, clear communication is crucial. Super funds must provide members with transparent information about the risks involved so they can understand how their retirement savings might be affected by developments in AI.
