Investing in Humanoid Robots. It’s Not Easy.

May 19. 2024. 7 mins read

What about Tesla (TSLA)? That’s the first thing many people will say when thinking about investing in humanoid robots. Yes, Tesla is building a humanoid robot called Optimus that they’ll probably put to work in any one of Musk’s many ventures. While Elon doesn’t think humanoids will be helping Tesla make cars any time soon, he does believe “it’s probably the least understood or appreciated part of what we’re doing at Tesla, but will probably be worth significantly more than the car side of things long-term.” If that’s the case, perhaps the robots ought to start building each other.

If Musk and Cathie Wood are to be believed, then Tesla’s car venture will be a minority segment for the firm as robotaxis and humanoid robots permeate developed markets that can afford them. The probability of that happening is reflected in Tesla’s rich valuation, but this article isn’t about the world’s second-largest producer of electric vehicles. It’s about investing in humanoid robots, an opportunity that’s believed to be measured in trillions of dollars.

Pie chart showing the estimated global humanoid total addressable market (2035)
Credit: Global X ETFs

Software vs. Hardware

Automation refers to “a wide range of technologies that reduce human intervention in processes” and includes the use of hardware and software. While industrial automation targets physical manufacturing, software automation has evolved from helping developers test their creations to repla

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