ChatGPT-owner OpenAI has been literally on a deal-signing spree recently, and its latest step in this initiative has been a colossal $38 billion-worth agreement with e-commerce giant Amazon.com (AMZN), announced yesterday. Per the terms of the deal, OpenAI will utilize Amazon Web Services (“AWS”) cloud infrastructure for the next seven years to run its core artificial intelligence (AI) workload.

As one can imagine, following this deal’s market announcement, Amazon’s stock price rose a solid 4% at the bourses on Nov. 3, reflecting investors’ optimism regarding the enormous growth potential of the AI industry.

With this deal coming as a powerful endorsement of AWS’ infrastructure, investors might want to tap into Amazon’s AI-driven growth by investing in this stock. However, with experts like the Chair of the Bank of England and JPMorgan Chase CEO Jamie Dimon warning that a “sudden correction” or “bubble territory” in AI-driven asset valuations is possible, considering exchange-traded funds (ETFs) with major exposure to AMZN would be a smart choice for now.

This is because ETFs offer built-in diversification to mitigate the risk associated with a single company’s volatility. So, if the anticipated “AI bubble” bursts, the broad exposure of an ETF would cushion the blow far better than an individual stock holding.

As market participants, we all know that OpenAI’s partnership with Amazon is not an isolated event but part of this AI startup’s broader, aggressive expansion and follows other high-value, multi-year commitments with tech giants like Microsoft (reportedly $250 billion), Oracle ($300 billion), and Alphabet’s Google Cloud Platform, along with chip supply deals with Nvidia and Broadcom.

While this massive spending is galvanizing the entire AI industry, some experts remain concerned about its real growth potential and fear that part of its valuation may be inflated. OpenAI’s plan to invest more than $1.4 trillion in infrastructure far exceeds its estimated annual revenue of roughly $13 billion, prompting concerns that the figures may be inflated or that the agreements are “circular,” driven largely by expectations of future returns.

Shortage of skilled labor in the United States, amid the uncertainty that has come with new tariffs and changes to immigration policy, will also remain a major bottleneck for the AI industry’s growth.

Furthermore, infrastructure experts remain skeptical about the capacity of the U.S. power grid and related systems to support this exponential AI growth. To this end, Bain & Company’s latest 2030 global data center forecast report shows that despite solid growth among hyperscalers, the AI industry will grapple with power availability and construction delay challenges.