This is where exchange-traded funds (ETFs) can come in very handy. By owning a basket of 50 or 100 stocks, an investor gets diversified exposure to a particular theme, sector, or geography.

With this in mind, here are two ETFs that are buying opportunities worth thinking about right now.

Physical AI revolution

Let’s start with an ETF that offers deep exposure to perhaps one of the most powerful technology trends this century. That is the iShares Automation & Robotics UCITS ETF (LSE:RBTX).

This fund focuses on companies developing automation and robotic technology. This area is being turbocharged by rapid advancements in AI, leading to what Nvidia CEO Jensen Huang recently called a “ChatGPT moment” for robotics (physical AI).

The ETF holds 134 stocks, covering the entire ecosystem required to make machines intelligent and autonomous. So that’s AI, which is ‘brains’ behind the automation, machine vision and sensor technologies, semiconductor equipment, and traditional manufacturing robots. 

Now, what I like here is that the ETF diverges significantly from the top of the Nasdaq-100 index. The single Magnificent Seven stock is Nvidia, but the AI chip leader is only a 3.13% weighting. This means there is far less Big Tech concentration risk.

A key risk here would be a global slowdown, which could result in slower adoption of robotic technology. Cost inflation and supply chain snags are also challenges that this industry is facing right now.

However, the loner-term trajectory looks far more certain. Nvidia’s chief executive says that in future every industrial company will be a robotics company, creating a multi-trillion dollar global market.

This ETF offers long-term investors exposure to this growth without having to pick individual winners. The ongoing charge is 0.4%.

High-quality blue chips

The second fund is iShares Core EURO STOXX 50 UCITS ETF (LSE:EUE), which is made up of the 50 largest blue chips from the eurozone.

Admittedly, Europe isn’t known for fast growth. As the old (perhaps slightly unfair) saying goes, “the US innovates, the EU regulates“. Indeed, between 2008 and 2023, EU GDP increased by 13.5% while US GDP rose by 87%, according to the World Bank.

The gap is probably going to widen further as the US is a net exporter of energy and AI technology while the EU relies on imports for both. Therefore, a spike in energy costs could hit European companies and consumers hard this year. 

Yet there are some truly world-class businesses across Europe, including ASML, Banco Santander, LVMH (Moët Hennessy Louis Vuitton), Hermes International, and German software firm SAP.

Zooming in on ASML, this is the only company in the world that makes EUV (extreme ultraviolet) lithography machines. Without these, there would be no advanced semiconductors and AI revolution. 

Or take plane maker Airbus, another top holding in the ETF. Its current order backlog is approximately 8,754 commercial aircraft (or about 10 years of work).

Moreover, European shares are cheap, with the ETF trading at just 17 times earnings while sporting a 2.6% dividend yield. The ongoing charge here is just 0.1%.

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Here are two such funds that I reckon are worth considering for a Stocks and Shares ISA in 2026.

Robotics revolution

Let’s start with the iShares Automation & Robotics ETF (LSE:RBTX). This one does what it says on the tin really, offering exposure to 137 stocks associated with the development of automation and robotic technology.

It’s no surprise then that we see Nvidia among the top holdings, as modern robotics is inseparable from AI, and that’s currently inseparable from Nvidia.

Take the company’s Cosmos platform, for example. It’s purpose-built for physical AI, enabling leading developers to use Nvidia’s software to accelerate the development of self-driving cars and robots. The list of customers speaks for itself.

However, the largest holding in the ETF, carrying a weighting of 5.2%, is Advantest. This Japanese company is the world leader in semiconductor automatic test equipment. Basically, before any chip is placed inside a robot, it must pass through an Advantest machine, making the firm a sort of hardware gatekeeper.

Elsewhere in the portfolio are chipmakers Intel and Advanced Micro Devices, as well as Rockwell Automation and surgical robot pioneer Intuitive Surgical. So it holds a wide range of stocks across the global robotics ecosystem.

Despite the ETF’s diverse holdings, any popping of the feared ‘AI bubble’ would likely hurt performance for a while. Meanwhile, further tit-for-tat tariffs could fuel inflation and squeeze supply chains, potentially slowing the industry’s progress.

However, with self-driving cars and robots still early in their development, I expect this one to perform well for a very long time to come.

The ETF is up more than 200% since launch in 2016, and there’s an ongoing charge of 0.4%.

UK property

Turning to a very different idea now with iShares MSCI Target UK Real Estate ETF (LSE:UKRE). This fund is invested in 28 UK real estate investment trusts (REITs), property companies, and fixed income securities.

Now, this one hasn’t performed well in recent years. Since the start of 2022, when interest rates first started shooting up, the share price has slumped by 36%.

This fall reflects the challenges higher interest rates pose for REITs, including increased debt-servicing costs and a more expensive environment for expanding property portfolios. These risks remain, which is reflected in a near-record low for the ETF’s share price.

However, the potential reward for taking on this risk is a chunky 6.5% dividend yield. And while there’s no guarantee all its underlying REITs will pay their dividends, the fund also has around 40% of the portfolio in UK inflation-linked government bonds, which provide a far more defensive income stream.

Looking ahead, interest rates are expected to keep falling next year, which would help REITs reduce the cost of their large debts. This could boost sentiment for high-quality REITs like Londonmetric Property, which makes up more than 6.5% of the ETF.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.

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Here are three very different ETFs that I think are worth assessing for a Stocks and Shares ISA.

Property income

The iShares MSCI Target UK Real Estate ETF (LSE:UKRE) offers diversified property exposure without owning physical real estate. Over half of the fund is in real estate investment trusts (REITs) and property companies, with the rest in UK inflation-linked gilts (government bonds whose payments rise with inflation). Bonds helps smooth out volatility and balance risk. 

REITs held here include Segro, Land Securities, and LondonMetric Property. The latter has a £7.4bn portfolio across sectors like logistics (warehouse tenants include Tesco, Primark, and Next) and entertainment and leisure (Alton Towers and Travelodge).

Of course, a UK recession is a risk. A downturn would add challenges for the retail and hospitality sectors, while souring investor sentiment for UK property and shares. It’s worth noting that the ETF has underperformed since interest rates rose sharply in 2022.

On balance though, I think now is a good time to consider investing for the long term. The ETF is offering a bumper 7% dividend yield!

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.

Robotics growth

Turning to growth with the iShares Automation & Robotics ETF (LSE:RBTX). This fund is invested in 138 stocks related to the development of automatic and robotic technology.

Unlike the one above, the ETF has had a better run — up 50% in three years.

Top holdings include chipmakers Nvidia and Advanced Micro Devices, which are suppling the computing power behind AI and robotics.

On the industrial side, giants like ABB and Siemens are world leaders in factory automation. Software players like Autodesk and Snowflake are also in the top 10 holdings.

Now, this tech bias does leave the fund open to underperformance if the sector fell out of favour. Some of the top holdings are highly valued, so this adds some valuation risk.

Over the long run, however, I’m very bullish on the robotics theme, particularly self-driving cars.

The ChatGPT moment for general robotics is just around the corner.

Nvidia CEO Jensen Huang

Investing in Europe

Finally, I think the iShares Core EURO STOXX 50 ETF (LSE:EUE) is one to examine. This tracks 50 of the largest firms across the eurozone, including German software giant SAP, Banco Santander, and French luxury conglomerate LVMH (Moët Hennessy Louis Vuitton).

Also in the top 10 holdings are two very special European businesses. The first is plane maker Airbus, whose backlog is enormous thanks to surging demand for fuel-efficient jets like the A320neo family. It has been taking market share from crisis-hit US rival Boeing.

Meanwhile, ASML is the only company in the world supplying extreme ultraviolet (EUV) lithography machines. These allow chipmakers like Taiwan Semiconductor Manufacturing and Samsung to make the most advanced semiconductors.

Without ASML’s machines, there would be no iPhone processors or AI revolution. 

That said, were ASML or SAP to sell off aggressively, the ETF could suffer because this high-quality pair account for over 13% of the portfolio. So there’s a degree of concentration risk.

But given the high quality of the stocks, I expect this ETF to do well over time. There’s also a handy near-3% dividend yield on offer.

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However, for growth investors wanting something a bit more niche, I think these three ETFs are worth a gander.

Digitilisation

Up first is the iShares Digitalisation ETF (LSE:DGTL). This holds 206 stocks that are generating significant revenues but still have growth potential due to the “increasing prevalence and application of digital services”. What I like here is that the ETF isn’t dominated by the usual tech names like Microsoft, Apple and Nvidia, which would make it similar to the S&P 500. As of 27 August, the top five positions were occupied by Oracle, Shopify, Cash App-owner Block, used car vendor Carvana, and eBay.

Other larger holdings include Netflix, Amazon, and Spotify. Meanwhile, digital payments is a prominent theme, through the likes of Visa, Mastercard, PayPal and Latin America’s MercadoLibre.

Digitalisation is a structural shift reshaping how the world buys (e-commerce/contactless payments), works (cloud computing), and plays (social media and streaming). To me, the ETF looks well placed to benefit from this, even though it echoes the risks of each individual stock it holds. 

Robotics

The second one is iShares Automation & Robotics ETF (LSE:RBTX). This gives investors exposure to shares benefitting from the development of automatic and robotic technology.

Right now, this industry’s booming due to advances in artificial intelligence (AI). The ETF holds Advanced Micro Devices (AMD) and Nvidia in semiconductors, as well as plenty of industrial automation leaders such as ABB, Siemens, Rockwell Automation, and Emerson Electric.

One risk to be aware of here is that the top of the ETF does lean quite heavily into semiconductor stocks. If this one sector slumps — for example, due to a chip cycle downturn — then the fund could take a hit. Nvidia, for instance, is currently trading near an all-time high.

However, there are 139 different holdings, so it’s well diversified. And over time, I expect this one to do well too.

According to Zion Market Research, the global robotics and automation market’s estimated to grow at a compound annual rate of around 38.2% between 2024 and 2032.

Artificial intelligence

Of course, I couldn’t finish without including the biggest technological trend of our time: AI. The iShares AI Innovation Active ETF (LSE:IART) aims to tap into this spectacular growth by owning AI-related stocks.

Now, I’d say this ETF’s higher in risk because it was only launched in January. Consequently, it has just 39 holdings so far, meaning it’s more heavily concentrated.

Also, the base currency is US dollars. If the dollar weakens against sterling, returns could shrink when converted back (and vice versa). This currency risk also applies to the iShares Digitalisation ETF. 

Nevertheless, AI’s developing so rapidly that it could unlock incredible amounts of business productivity, especially as the technology’s still at a very early stage. Indeed, it’s slightly frightening.

We’re at the beginning of a new industrial revolution.

Nvidia CEO Jensen Huang.

As well as the tech giants, the ETF holds Snowflake and web security firm Cloudflare as top 10 holdings. Snowflake stock surged 20% on 28 August as company reported a blockbuster Q2, with growing adoption of its AI-powered data cloud.

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Here are a trio of thematic ETFs that I reckon deserve closer attention from investors.

Robotics

The first big trend I want to highlight is robotics in the shape of the iShares Automation & Robotics ETF (LSE: RBTX). This one is pretty self-explanatory, as it focuses on companies associated with the development of automatic and robotic technology.

However, there are many different directions to go with this, including industrial automation, software, and even robot-assisted surgery. The ETF’s holdings reflect this diversity, with the likes of Nvidia (AI semiconductors), Rockwell Automation (factory automation), and Dassault Systemes (virtual twin software). 

The ETF’s share price has jumped 63% over the past five years.

One risk here is tariffs (yes, those still). Fact is, the market appears to think they’re in the rear-view mirror, but their impact probably hasn’t even started yet. A global economic downturn would likely reduce capital expenditure, including investments in automation.

The longer term looks brighter, though. Morgan Stanley Research estimates the humanoid robot market is likely to reach $5trn by 2050. “Adoption should be relatively slow until the mid-2030s, accelerating in the late 2030s and 2040s”, says analyst Adam Jonas.

Cybersecurity

Next, we have the iShares Digital Security ETF (LSE: LOCK). This one holds 111 firms that provide services designed to secure digital infrastructure. In simple terms, companies defending data, networks, and systems from cyber threats in our increasingly online world.

Top cybersecurity and security stocks here include Fortinet, Datadog, Palo Alto Networks, Cloudflare, and Okta. The share price is up 68% in the past five years.

Now, one thing to note here is that the fund is denominated in dollars (each share is currently just under $10). So one risk would be the pound strengthening significantly against the dollar, which would impact returns. 

Thematically though, it seems inevitable that cybersecurity spending will keep on rising. According to the Royal Institution of Chartered Surveyors, 73% of 8,000 UK business leaders expected their company to be hit with a cyber-attack in the next 12 to 24 months.

Nowadays, cybersecurity has become an absolute necessity rather than a luxury. And this bodes well for this ETF.

Defence

The final big trend is rising military spending by NATO members. Recently, they committed to spending 5% of GDP annually on defence over the next 10 years.

This brings me onto the HANetf Future of Defence ETF (LSE: NATP). It provides exposure to firms generating revenue from NATO defence and cyber defence spending.

Top holdings include AI software giant Palantir, Germany’s Rheinmetall, cybersecurity innovator CrowdStrike, and the UK’s BAE Systems.

Since launch in 2023, the ETF’s share price has rocketed 126%. This reflects the bullish sentiment around defence stocks.

That said, sentiment could quickly change if geopolitical tensions ease. Sadly though, we’re seeing more confrontation and less cooperation.

Meanwhile, there’s an unprecedented surge in cyberattacks, which will likely grow in sophistication and intensity in the age of AI.

Given this volatile backdrop, I think the Future of Defence ETF is set for further gains in the years ahead.

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With this in mind, here are two ETFs that I reckon are worth considering for a £20,000 Stocks and Shares ISA.

A ready-made portfolio of dividend payers

First up is the iShares UK Dividend UCITS ETF (LSE: IUKD). This gives diversified exposure to high-yield income stocks from the Footsie and FTSE 250.

It currently has 51 holdings, including British American Tobacco, Legal & General, BP, Aviva, Lloyds, and HSBC. The dividend yield is 5.32%, comfortably above the FTSE 100‘s 3.4%.

In practice, this means the ETF is offering £532 in annual income from a £10,000 investment. Then there’s the possibility of share price appreciation on top, though markets do fall as well as rise, of course.

Now, one risk here is that the focus is solely on dividend stocks listed in the UK. Therefore, if this type of share suddenly falls out of favour, the ETF would underperform. Plus, another pandemic-type event could see many companies suspend dividends again.

However, I’m encouraged by the share price performance here. Over five years, the iShares UK Dividend ETF is up around 50%. Adding in the income too, that’s a solid return.

Looking at the portfolio, which contains many cheap UK shares, I think the ETF will carry on doing well in future.

The robots are coming

Next is the iShares Automation & Robotics UCITS ETF (LSE: RBTX). As the name implies, this tracks global companies dedicated to automation and robotics innovation (140 of them). 

This area is expected to enjoy robust growth over the next decade due to manufacturing and warehouse automation, industrial Internet of Things, self-driving cars, and intelligent software that can execute tasks autonomously (AI agents).

Top holdings include Nvidia and Advanced Micro Devices (AMD), the chipmakers that provide the computational muscle behind everything from AI chatbots to humanoid robots. 

On the industrial side, Rockwell Automation and Emerson Electric are powering the next generation of smart manufacturing, while Intuitive Surgical is a pioneer in robotic-assisted surgery. 

ServiceNow and Snowflake are involved with AI agents in one way or another. As Amazon CEO Andy Jassy recently said: “Many of these agents have yet to be built, but make no mistake, they’re coming, and coming fast.”

Since its launch in 2016, the iShares Automation & Robotics ETF is up 210%. That’s impressive, while the ongoing charge of 0.40 % is reasonable for a high-quality thematic ETF, in my opinion.

As for risks, areas of the robotics industry can be cyclical, so a global slowdown could dent performance for a while. Also, nearly 69% of the fund is in technology stocks, meaning any sell-off in that sector would impact the fund.

Looking ahead, however, I’m bullish on this ETF’s prospects. There’s a good mixture of large and smaller business across hardware, software, and industrial engineering. 

Nvidia CEO Jensen Huang has declared that “we are at the beginning of a new industrial revolution“. This ETF offers bags of exposure to this, making it worth considering for a growth-oriented ISA.

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