A new report from Mirae Asset Securities has highlighted the opportunity for SK Hynix Inc (NASDAQ:SKHY), raising its target price on the South Korean memory-chip maker by 10.7% to 3.1 million won. The brokerage expects high-bandwidth memory (HBM) demand to broaden as major technology companies increasingly deploy their own AI accelerators.
That could have implications beyond SK Hynix stock. A growing number of ETFs now give investors direct or indirect exposure to the memory companies benefiting from the AI boom.
HBM: The AI Bottleneck
Mirae Asset expects demand for HBM capacity and bandwidth to remain strong as GPU makers move toward HBM4 and increase memory capacity per accelerator.
AMD’s MI455X, for instance, is expected to feature 12 HBM4 stacks with 432GB of memory. Nvidia Corp’s (NASDAQ:NVDA) Rubin platform features 288GB of HBM4, while Meta Platforms, Inc (NASDAQ:META) and Microsoft Corp (NASDAQ:MSFT) are also increasing HBM capacity in their custom AI accelerators, according to the report.
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The bigger change is the diversification of customers.
Instead of HBM demand being overwhelmingly associated with Nvidia, Mirae Asset sees growing adoption among custom AI chips developed by companies such as Meta and Microsoft. The brokerage also expects HBM customer diversification to accelerate as the use of proprietary AI accelerators expands.
That potentially broadens the investment opportunity for memory-chip ETFs.
DRAM: The Purest Memory Play
The most direct ETF expression of the theme is the Roundhill Memory ETF (BATS:DRAM).
It is the first memory-focused ETF, offering targeted exposure to global memory-chip companies. The fund is designed around the secular growth in memory and storage driven by AI infrastructure.
The ETF has meaningful exposure to the three companies at the heart of the memory market. Samsung Electronics accounts for about 25.14% of the portfolio, SK Hynix about 23% and Micron Technology, Inc (NASDAQ:MU) about 25%.
That makes DRAM particularly interesting for investors who believe the AI trade is moving beyond GPUs and into the memory bottleneck.
SMH and SOXX: A Broader AI-Chip Bet
The VanEck Semiconductor ETF (NASDAQ:SMH) holds companies across the semiconductor ecosystem. Its portfolio includes Nvidia, Taiwan Semiconductor Manufacturing Co Ltd (NYSE:TSM), Micron, Broadcom Inc (NASDAQ:AVGO) and Advanced Micro Devices Inc (NASDAQ:AMD), giving investors exposure to both AI processors and the companies supplying the infrastructure around them. The fund has gained about 58% year-to-date.
The iShares Semiconductor ETF (NASDAQ:SOXX) provides another diversified route. Its largest holdings include Nvidia, Micron, AMD and Broadcom, making it less directly tied to the HBM cycle than DRAM but still exposed to rising AI semiconductor demand. SOXX had gained over 74% year to date.
EWY gives investors a South Korea angle
There is also a geographic way to play the theme.
The iShares MSCI South Korea ETF (NYSE:EWY) has SK Hynix and Samsung Electronics as its two largest holdings. SK Hynix represents 25% of the fund and Samsung accounts for another 23%. That means almost half of EWY is currently concentrated in the two South Korean technology giants that dominate the country’s AI-memory story.
For investors bullish on the Korean semiconductor industry but unwilling to make a single-stock bet, EWY offers a more diversified alternative.
An Even More Aggressive Option
The surge in interest around SK Hynix has also spawned leveraged ETFs.
For instance, the Direxion Daily SK Hynix Bull 2X ETF (NYSE:SKHL) and the ProShares Ultra SK Hynix ETF (NYSE:SKHU) seeks200% of the daily performance of SK Hynix. They launched soon after SK Hynix’s ADR began trading, making the company much easier for U.S. investors to access.
These funds are a very different proposition from DRAM, SMH or EWY. They are designed for short-term leveraged exposure, and daily compounding can significantly affect returns over longer holding periods.
The Bigger ETF Story
The SK Hynix thesis is increasingly becoming an AI memory story rather than simply a semiconductor story.
Mirae Asset expects SK Hynix’s DRAM average selling prices to rise 15.8% sequentially in the third quarter, 7.2% in the fourth quarter and 23.9% in 2027. It also expects operating profit to reach 386 trillion won in 2027.
For ETF investors, that creates several ways to express the same AI thesis.
DRAM offers the most concentrated memory exposure. SMH and SOXX provide broader semiconductor exposure. EWY offers a South Korea-focused route, while SKHL and SKHU provide leveraged exposure to SK Hynix itself.
As AI accelerators pack in more HBM, the memory trade could become an increasingly important part of the ETF market’s next phase of the AI boom.
Photo: Mentor57 / Shutterstock
