REX Advisers is set to list the REX AI Chipmaking ETF (CHIP) on Nasdaq on Wednesday, targeting investors who want exposure to the machines that produce artificial-intelligence chips rather than the chip designers themselves.
How the fund is built
The fund follows the VettaFi AI Chipmaking Index, which concentrates on three production stages: wafer-fabrication tools, advanced packaging systems and metrology devices. To qualify for inclusion, a company must derive more than half of its sales from one of those areas, while pure chemical suppliers are excluded.
Wafer-fabrication tools receive the largest share at roughly 50% of the benchmark, according to the prospectus. Advanced packaging accounts for about a quarter, and metrology makes up the remaining 25%.
Geographic mix and leading positions
U.S. and Japanese firms dominate the geographic breakdown, together representing just over two-thirds of the holdings at 35.3% and 30.5% respectively as of Aug. 31. The Netherlands and Taiwan follow with 13.7% and 6.8%.
Japan’s Advantest Corp., a supplier of chip-testing equipment, tops the list with a 7.8% weighting. It is followed by ASE Technology Holding (5.8%) and Teradyne (5.3%). ASML, Applied Materials and Lam Research round out the top six positions.
The ten biggest constituents together represent 52.5% of the benchmark, indicating a concentration in a relatively small number of firms.
Index launch, market-cap range, and VettaFi’s role
The VettaFi AI Chipmaking Index was launched on August 21. The index’s constituents span a market-capitalization spectrum from a company valued at $658.3 billion down to one priced at $538 million.
VettaFi LLC serves as the index provider for CHIP and receives a licensing fee. The firm does not issue, sponsor, endorse, or sell the ETF, and it bears no obligations or liability for the fund’s issuance, administration, marketing, or trading.
Cost structure and management
The fund charges an expense ratio of 0.65% and holds 55 securities, which are rebalanced each quarter. Portfolio managers Matthew Pelletier and Matthew Holcomb have overseen the vehicle since its inception earlier this year.
According to VettaFi data, the underlying index has risen 126.6% over the trailing twelve months and 63.7% year-to-date, reflecting strong performance amid rising AI infrastructure spending. That growth shows the increasing demand for equipment that enables AI-driven chip production.
Leave a Reply