Semiconductor stocks staged a strong rebound on August 17, with CXMT Corporation surging 12% to close at an all-time high, pushing its market capitalization back above the 4 trillion yuan mark. The HUABAO SHANGHAI SCI TECH INNOVATION BOARD CHIP TRADING OPEN ENDED INDEX SECURITIES INVESTMENT FUND (589190), which allocates nearly half its weight to memory chip stocks and charges one of the lowest fee structures in its category, saw its on-exchange price rally 5%, also hitting a fresh high since the August rebound began.
Gains were broad-based across semiconductor equipment, optical chips, memory, and wafer foundry segments. Zhongke Feice, Shijia Photonics, Pranan Technology, and Fuding Technology led with double-digit advances, while Verisilicon rose over 9%, Nexchip Semiconductor and SICC gained more than 8%, and GigaDevice and Huatest were up over 7%.
On the news front, SK Hynix announced a $38.4 billion investment to build a new wafer fabrication plant in South Korea, responding to the surging memory chip demand driven by the AI era. SK Group Chairman Chey Tae-won reiterated in a recent interview that memory demand is exploding and warned that next year will see the most severe "memory famine" on record. Earlier reports indicated that the world's top three memory makers - Samsung, SK Hynix, and Micron - have already fully locked in their entire 2027 capacity for HBM and high-end DRAM.
As China's largest integrated DRAM developer, manufacturer, and designer, CXMT Corporation holds a 7.67% global market share in 2025. The company is well-positioned to benefit significantly from the global memory shortage, which should also provide a strong boost to the domestic semiconductor chip industry.
Where the opportunity lies
According to Caixin Securities, the memory industry is in a super-cycle driven by AI computing power, characterized by tight supply-demand dynamics and simultaneous price and volume increases. On the demand side, the rapid iteration of AI large models and accelerated computing infrastructure buildout are dramatically lifting demand for HBM, DRAM, and enterprise-grade flash memory in high-end servers and AI inference scenarios. On the supply side, memory manufacturers are concentrating their 2026 capacity expansion on high-value HBM products, leaving limited incremental effective supply for traditional DRAM and NAND flash, widening the industry's overall supply-demand gap.
Additionally, during the interim earnings reporting season, several chip giants including SMIC, Hygon Information, and Hua Hong Semiconductor have recently reported results that significantly exceeded expectations. Strong earnings beats and optimistic forward guidance from key companies are expected to provide substantial support for the semiconductor sector's recovery and rebound.
Looking ahead, Huatai Securities believes the market's oversold bounce has entered a transitional phase. With the dampening impact of overseas Fed rate hike expectations continuing to fade, and Oman and Iran reaching an agreement on Strait of Hormuz passage protocols, overseas risk appetite is strengthening. Meanwhile, as China enters the peak interim earnings season, the high-growth trajectory of the technology sector is being continuously validated, suggesting the rebound has room to extend.
Why just one ETF?
For investors seeking to capture the chip industry's "super-cycle," the 20CM high-volatility product offers compelling exposure. Public data shows that the HUABAO SHANGHAI SCI TECH INNOVATION BOARD CHIP TRADING OPEN ENDED INDEX SECURITIES INVESTMENT FUND (589190) and its feeder funds (Class A: 021224, Class C: 021225) passively track the SSE STAR Market Chip Index, providing balanced allocation and full-chain coverage of the chip industry. The fund allocates over 90% of its weight to core areas such as integrated circuits and semiconductor equipment, offering high hard-tech concentration and strong offensive characteristics.
Public data also reveals that the fund charges a management fee of 0.3%, a custodian fee of 0.08%, and a combined fee rate of 0.38%, making it one of the lowest-cost ETFs tracking the same underlying index.
Data sources: Shanghai and Shenzhen stock exchanges, among others. Note: Memory chip content refers to the combined weight of constituent stocks in the SSE STAR Market Chip Index that are also components of the Memory Chip Index (980138.CNI), which stood at 49.95% as of August 14.
Institutional views: Caixin Securities, August 14, 2026, "Memory Industry Deep Report: AI Ignites Memory Demand, Supply Constraints Support High-Industry Prosperity Cycle"; Huatai Securities, August 9, 2026, "External Risk Appetite Boost, Market Rebound Continues."
ETF fee-related notes: When subscribing or redeeming fund shares, subscription/redemption agents may charge commissions of up to 0.5%, which includes fees collected by securities exchanges and registration institutions. Feeder fund fee notes: Class A subscription rates (front-end) are 1,000 yuan per transaction for subscriptions of 2 million yuan or more, 0.2% for amounts between 1 million and 2 million yuan, and 0.5% for amounts below 1 million yuan. Redemption fees are 1.5% for holdings of less than 7 days and 0% for holdings of 7 days or more. Class C shares charge no subscription fee, with redemption fees of 1.5% for holdings under 7 days and 0% for holdings of 7 days or more, plus a 0.2% sales service fee.
Risk disclosure: The HUABAO SHANGHAI SCI TECH INNOVATION BOARD CHIP TRADING OPEN ENDED INDEX SECURITIES INVESTMENT FUND (589190) and its feeder funds passively track the SSE STAR Market Chip Index, which has a base date of December 31, 2019, and was published on June 13, 2022. The index's returns over the past five full calendar years were 6.87% in 2021, -33.69% in 2022, 7.26% in 2023, 34.52% in 2024, and 61.33% in 2025. Its volatility over the same period was 34.32% in 2021, 36.60% in 2022, 28.64% in 2023, 44.67% in 2024, and 34.34% in 2025. Index constituent composition adjusts according to index compilation rules, and backtested historical performance does not indicate future index performance. This product is issued and managed by Huabao Fund, and distribution institutions do not bear responsibility for product investment, redemption, or risk management. Investors should carefully read the Fund Contract, Prospectus, Fund Product Information Summary, and other fund legal documents to understand the fund's risk-return characteristics and select products suitable for their own risk tolerance. The fund manager has assessed this fund's risk rating as R4 - medium-high risk, suitable for investors rated C4 and above. Performance of other funds managed by the fund manager does not constitute a guarantee of this fund's performance. Past fund performance does not indicate future returns. Funds carry risks; investors should invest cautiously. Sales institutions (including the fund manager's direct sales channels and other sales channels) conduct risk assessments of this fund in accordance with relevant laws and regulations. Investors should promptly review the suitability opinions issued by the fund manager. The suitability opinions of various sales institutions may not be consistent, and the fund product risk ratings issued by fund sales institutions may not be lower than the risk rating results issued by the fund manager. Risk-return characteristics described in the fund contract may differ from the fund risk rating due to differing considerations. Investors should understand the fund's risk-return profile and carefully select fund products based on their own investment objectives, time horizon, investment experience, and risk tolerance, assuming their own risks. Registration of this fund with the China Securities Regulatory Commission does not indicate a substantive judgment or guarantee of the fund's investment value, market prospects, or returns. Funds carry risks; invest with caution.
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