As global big tech shifts artificial intelligence (AI) infrastructure investment from power grids to optical communications, competition is heating up in Korea's ETF market for new products targeting next-generation AI infrastructure.
Korean asset management companies are introducing ETFs themed around next-generation AI infrastructure, such as optical communication networks and low Earth orbit satellites, to solve bottlenecks at AI data centers.
According to the Korea Exchange (KRX) on the 17th, on the 14th Samsung Active Asset Management and NH-Amundi Asset Management each listed optical communication technology theme ETFs on the main board, recently cited as the core of next-generation AI infrastructure. The newly listed ETFs swiftly reflect investment demand for next-generation infrastructure in line with the paradigm shift in the AI industry.
In the financial investment industry, analysts say the center of gravity in AI infrastructure investment is moving from "power grid expansion and transformers" (copper wire) to "optical communications and satellite networks" (glass wire) to resolve data center bottlenecks.
Because the technology uses optical fiber instead of copper cables, the market calls it "glass wire." With AI computation surging, the importance of optical communication technology, which can reduce data transmission bottlenecks, is growing rapidly.
Goldman Sachs recently pointed to "optical networking" technology as a key driver of AI infrastructure expansion in a report. Optical networking maximizes the performance of a single AI chip while connecting countless chips without latency. Goldman Sachs projected that if Rubin Ultra (NVL576), Nvidia's next-generation AI server platform, is rolled out in earnest, the related market size could expand about ninefold to around $154 billion compared with existing models.
Yoo Seong-min, a researcher at Samsung Securities, said, "Even as the efficiency of AI infrastructure investment is emphasized, demand for ultra-high-speed networks to solve data transmission bottlenecks is stronger than ever," and noted, "The optical communications sector, a critical gateway for AI's evolution, will continue to offer attractive investment opportunities."
In response, Samsung Active Asset Management and NH-Amundi Asset Management each designed differentiated optical communications theme products with active and passive approaches, respectively, setting up a head-to-head matchup.
KoAct Optical Communications & Satellite Network Active, an ETF introduced by Samsung Active Asset Management, is an active product tailored to the fast pace of technological change in the AI industry, allowing flexible adjustments to holdings based on market conditions. It set the FnGuide Low Earth Orbit Satellite & Optical Communications Infrastructure Index as its comparison index. This index consists of key companies across the value chain for satellites, space, and optical communications, including low Earth orbit satellites. Using this index, Samsung Active Asset Management built a portfolio of 20 stocks, including 10 in low Earth orbit satellites and 10 in optical communications infrastructure.
NH-Amundi Asset Management unveiled HANARO US AI Optical Communication TOP10, which tracks 10 key corporations leading the U.S. AI optical communications market based on a passive strategy. The product uses the INDXX US AI Optical Communication TOP10 Index as its underlying index.
Expected major constituents include Marvell Technology, as well as Coherent, Lumentum Holdings, Corning, and FormFactor. Corporations representing the value chain for optical communication equipment and optoelectronics for AI data centers—such as Tower Semiconductor, Applied Optoelectronics, Viavi Solutions, Ciena, and AXT—are forming the portfolio.