Experts suggest that thematic tech ETF investing may have limited applications.

Despite the recent shift away from large-cap technology stocks, there may still be a reason to invest in thematic technology exchange-traded funds.

Despite recent volatility in the group, Roundhill Investments CEO Dave Mazza believes the investment thesis of the Roundhill Generative AI & Technology ETF (CHAT) is still intact, as the ETF has gained 13.8% year to date as of Friday's market close.

"He informed CNBC's "ETF Edge" that the names are still performing well, despite a wobble in July and August. In the last month, performance has generally been in line with the market."

Despite falling short of the 3.5% increase achieved by the benchmark index during the past month, the fund has still gained 2.1%.

According to FactSet, the top three holdings in CHAT are Nvidia, Microsoft, and Alphabet, with a total of 52 holdings. Despite concerns about the narrow scope of thematic ETFs, Mazza dismissed the idea that they may be too limited.

He stated that there are companies in the portfolio, like and others, who are utilizing AI and integrating AI.

'Right tools for the right job'

Financial futurist Dave Nadig believes that thematic ETFs are more suitable for traders than long-term investors due to their narrower use case.

"Nadig stated in the interview that the key to success is having the appropriate tools for the task at hand. He emphasized that the average holding period for thematics is only weeks, making them a popular way to express short-term opinions."

The actively managed CHAT ETF has a management fee of 0.75%, which may be relatively steep for some investors.

The higher fees for thematic funds may be justified, Nadig proposed.

"An active manager overlay makes sense for fast-moving technology," he added.

Roundhill's Mazza also sees the benefit in an active approach.

"Mazza stated that for investors seeking to increase their performance potential, it is worth considering either credible active management or a method to achieve a specific outcome in that space. He pointed out that many thematic ETFs are actually more affordable than traditional active management and mutual fund options."