Impact of AI Advancements & New Investment Trends in the ETF Market
The 'iShares Expanded Tech-Software Sector' (IGV) ETF, focused on software firms, saw an outflow of approximately 1.8 trillion won in August. This reflects a weakening rally initially spurred by AI technology advancements. The IGV invests in major software stocks such as Palantir, Microsoft, Oracle, and Adobe, but its performance lags behind the S&P500 and Nasdaq indices. Experts note that Adobe and Salesforce are facing competitive threats from AI, advising investors to focus on irreplaceable software companies like Microsoft, Oracle, and Palantir.
In a separate development, Xiaomi is gaining attention in South Korea for its 'physical AI' that combines AI with manufacturing. By leveraging smart factory capabilities, Xiaomi is extending its influence in the electric vehicle market. Consequently, Hana Asset Management has launched the '1Q Xiaomi Value Chain Active' ETF, which is the first of its kind in South Korea focused on Xiaomi and its related value chain companies. This ETF invests in over 20 value chain companies including Alibaba and China Mobile, emphasizing an active management strategy to select optimal stocks.
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Hana Asset's Kim Seung-hyun, Head of Division, 'Leading Trend with Xiaomi ETF' [ETF Launch] - Smart Today|Smart Today=Reporter Sim Doo-bo| In an era where U.S. stocks are monopolizing investors' attention, an 'outlier' has emerged. It's Xiaomi. According to the Depository Settlement Center on the 2nd, Xiaomi ranked 19th this year among the foreign stocks most net purchased by domestic investors. Domestic investors are favoring not only major U.S. big tech like Google and Meta but also Tempus.