So I've been digging into how to invest in artificial intelligence, and there's this interesting thesis from Cathie Wood that keeps popping up. She's been making the case that software companies could be the real winners in the AI race -- specifically, she's saying they can generate $8 in revenue for every dollar spent on chips. That's a pretty compelling angle if she's right.

Wood runs Ark Investment Management, and she's positioned a couple of their ETFs to capitalize on this AI software opportunity. I looked at the holdings and it's worth understanding what she's actually betting on here.

The Ark Innovation ETF is their flagship fund, and it's actively managed, so Wood's team is constantly reshuffling to chase what they think will work. The fund throws money at what Ark calls "disruptive innovation" -- cloud computing, precision therapies, digital assets, autonomous vehicles, neural networks, that whole ecosystem. It holds 34 stocks, but here's the thing: five positions account for nearly 44% of the portfolio. Tesla leads at 14.39%, followed by Roku, Coinbase, Roblox, and Robinhood Markets.

On the surface, these don't scream "AI software stocks," but Wood's logic is interesting. She believes Tesla is basically the world's biggest AI project because of its full self-driving capability. She's projecting Tesla's revenue could hit $1.2 trillion by 2029, with 63% coming from FSD software and the Cybercab robotaxi platform. Even Roku uses AI to personalize content and optimize display quality on its smart TVs. The ETF also holds Palantir, Tempus AI, UiPath, Meta -- all playing in the AI software space.

The catch? This fund charges a 0.75% expense ratio, which is steep compared to basic index funds. And Ark's track record shows these portfolios swing hard -- the Innovation ETF returned 34% over the past year but is still down 60% from its 2021 peak. You need stomach for volatility.

The other option is the Ark Autonomous Technology and Robotics ETF, which is narrower in focus but arguably more focused on the AI and automation thesis. Tesla's also the top holding here at 14.54%. Then you've got Kratos Defense making unmanned systems, Teradyne automating industrial processes, Rocket Labs in aerospace, and Archer Aviation working on autonomous aircraft. Same 0.75% fee, but this one's been steadier -- it's delivered 14.8% annually since 2014, actually beating the S&P 500's 13.7% return over that same period. It's only down 15% from its 2021 high, so it's recovering much faster.

The real question for anyone looking at how to invest in artificial intelligence through these funds is whether you believe Wood's thesis about software being the dominant value creator. If she's right, both ETFs offer solid exposure to that trend. But you're paying for active management and you're getting volatility. The Autonomous Tech ETF seems like the more battle-tested option, but the Innovation ETF offers broader AI software exposure if you can handle the swings.