What Is ChatGPT and How to Invest in It

Generative AI has become the most hyped technology since the smartphone, and ChatGPT is the biggest reason why.

The technology has wowed everyone from CEOs to technologists to ordinary users, performing a wide range of activities like writing poetry and computer code or explaining complex subjects in neatly packaged paragraphs. It's also passed high-level exams for law school, medical licensing, and MBA programs, and it continues to get better with regular updates.

ChatGPT (the name stands for "Chat Generative Pre-Trained Transformer") uses a simple chat interface to answer questions directly and is as easy to use as Google Search. The free artificial intelligence (AI) chat interface signed up 100 million users in just two months after its November 2022 launch, and it has the potential to disrupt industries from internet search to content creation. It now has 800 million weekly users.

In this article, we'll discuss the implications for ChatGPT and generative AI chatbots more generally, how you can get exposure to it as an investor, and whether you should invest in ChatGPT.

ChatGPT isn't publicly traded, and OpenAI, the company that built it, isn't either. However, there are a number of ways to get exposure to ChatGPT.

The most direct one is through Microsoft (MSFT -1.04%), the tech giant that has had a strategic partnership with OpenAI since 2019 and has invested billions of dollars into the AI startup. After ChatGPT was unveiled in late 2022, Microsoft invested $10 billion in OpenAI, showing both the company's confidence in OpenAI's potential and its belief that artificial intelligence is the next major computing platform.

Following a recent restructuring that established OpenAI as a for-profit company, Microsoft owned 27% of the ChatGPT-maker, a stake that was worth $135 billion, as OpenAI was recently valued at $500 billion in an insider stock sale. While the new agreement gives each company more freedom to form new AI partnerships, their futures in AI are still likely to be closely tied together.

Another way to get exposure to ChatGPT is through Nvidia (NVDA -3.30%). Nvidia is one of the world's most valuable semiconductor companies and the leading producer of graphics processing units (GPUs). Its GPUs and accelerators are essentially the building blocks of artificial intelligence, training large language models like ChatGPT and processing large amounts of data. They are a key component in many machine learning models, and they have been in such high demand that there have been frequent shortages. Nvidia and OpenAI also signed an agreement recently in which Nvidia will progressively invest as much as $100 billion in OpenAI as it deploys Nvidia GPUs.

Nvidia dominates the market for data center GPUs, and it has thus far resisted competition from peers like Advanced Micro Devices (AMD -4.81%) and Intel (INTC -4.33%).

Microsoft is best known as a diversified global tech giant. It makes money from a wide range of products, including its Windows operating system, Azure cloud infrastructure service, subscription products like its Office software suite, hardware like Surface, gaming products under Xbox, and the LinkedIn professional social network.

However, more recently, Microsoft has been getting attention for its strategic partnership with OpenAI since the company has bet big on OpenAI and ChatGPT. Microsoft CEO Satya Nadella has called AI the next major computing platform and has already leveraged the power of ChatGPT and OpenAI's tools in a number of products, including Azure and Copilot, Microsoft's new AI assistant.

Its partnership with ChatGPT is also delivering results in its AI partnership, as Microsoft has seen traction in Azure OpenAI. More than 80% of the Fortune 500 now use Azure OpenAI, and midway through 2025, the company said it had more than 800 million monthly active users of its AI features across its products.

If you're looking for the company that's most closely connected with OpenAI and ChatGPT, Microsoft is your best choice. However, the company is big enough that only a relatively small amount of the business is exposed to ChatGPT.

Nvidia's stock has taken off over the last decade as its graphics processing chips have become a vital part of everything from gaming to self-driving cars to artificial intelligence.

AI comes with extraordinary computing demands, and Nvidia's chips are able to handle the workload better than its competitors. Demand for its chips has skyrocketed over the last two years and is still soaring as the company sells the building blocks for AI platforms. More than two years after ChatGPT's release, Nvidia has emerged as the biggest winner from the AI boom, since cloud infrastructure companies and others need its chips to run AI models. Its revenue more than doubled over five consecutive quarters, and while it's slowed to a more moderate rate, its growth is still robust.

UBS (UBS +1.24%) estimated that 10,000 Nvidia GPUs were used to train ChatGPT, and some analysts estimate that 30,000 of its GPUs were being used to run OpenAI's chatbot, though that number is likely in the hundreds of thousands or even millions. OpenAI CEO Sam Altman has praised Nvidia's hardware on multiple occasions. The ChatGPT creator is also working closely with Nvidia, Microsoft, and Arm on the new Stargate Project, a $500 billion plan to build new AI data centers and promote AI research and development (R&D) in the United States.

Additionally, Nvidia has teamed up with Microsoft to build a massive cloud AI computer using tens of thousands of Nvidia GPUs and other Nvidia AI software tools.

Given Nvidia's strength in AI computing power, it looks like a good AI stock to own if you're looking for an investment that will benefit from the growth of artificial intelligence.

Arm Holdings has seen its growth rate accelerate as AI demand begins to flow. The company is benefiting from its low-power CPU architecture, which is more efficient than the x86 alternative from Intel and AMD.

Arm operates with a unique business model, earning revenue from licensing its designs and then from royalties once those products come to market. For example, one of its customers is Microsoft, which uses Arm architecture for its new Cobalt CPU. Cobalt runs cloud-native and general-purpose workloads, and reflects increasing demand for its products in the AI era.

In its recent reports, management noted strong AI demand and rising adoption of compute subsystems (CSS) across major market segments, showing it's advancing its technology to meet increased AI demand.

Arm's fortunes seem closely tied to AI demand, as the speed with which generative AI technology, including ChatGPT, gains adoption will influence the company's growth.

1. Invesco AI and Next Gen Software ETF

The Invesco AI and Next Gen Software (IGPT -2.93%) focuses on AI stocks that are closely related to generative AI and ChatGPT.

Its top three holdings, for example, are Nvidia, AMD (AMD -4.81%), and Meta Platforms (META -1.34%), three companies that are all investing heavily in generative AI.

The ETF is based on the STOXX World AC NexGen Software Development Index, which comprises companies with significant exposure to technologies that contribute to advancements in software development. The ETF has been around for almost 20 years and charges an expense ratio of 0.56%.

2. Roundhill Generative AI & Technology ETF

Roundhill Generative AI & Technology ETF (CHAT -4.12%) was the first ETF designed to track generative AI stocks. Roundhill believes that generative AI will be one of the most important technological innovations of the future as it delivers significant productivity growth.

Its top three holdings are currently Alphabet, Nvidia, and Microsoft. The fund began trading in May 2023, making it one of the newer ETFs available on the market. It has an expense ratio of 0.75%.

3. iShares Robotics and Artificial Intelligence Multisector ETF

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