On the evening of June 29th, the leading company in the memory chip sector, GigaDevice, issued an announcement cautioning about trading risks associated with its stock.
The firm's share price had surged by 73.42% over a span of 10 consecutive trading days from June 15th to June 29th, 2026. Furthermore, it had skyrocketed by 125.60% over a period of 30 consecutive trading days from May 18th to June 29th, 2026. Given this substantial short-term appreciation, the company warned that there is a risk of a rapid price decline in the future.
The announcement indicated that the memory chip industry in which the company operates has historically exhibited significant cyclical volatility. Current product prices are already at historically high levels, and a continuation of the steep upward trend is unsustainable. The industry's supply and demand will eventually move towards a rebalancing.
The company currently focuses on niche memory products, which are supplied to a broad and fragmented downstream market beyond mobile phones, PCs, and servers. This includes sectors such as consumer electronics, industrial applications, networking, and automotive. The recent price increases for these products are primarily driven by a significant surge in demand from the mainstream memory market, particularly for AI-related needs. This has led major international memory manufacturers to shift their operational focus to these product areas, with the niche memory market benefiting indirectly from the resulting supply tightness.
Unlike the mainstream memory market, the total downstream demand for niche memory is relatively stable. During the industry's rapid price ascent, downstream demand has already been somewhat suppressed. Subsequently, as marginal production capacity in the niche memory market increases, prices are expected to experience a considerable decline.
The company operates on a fabless model. Against the backdrop of an overall supply shortage in the niche memory market, there is a risk that the production capacity supply from its upstream partner foundries could become even tighter.
On June 29th, GigaDevice's stock closed up 9.09%, nearing the daily limit, with a trading volume reaching 43.1 billion yuan, hitting a record high and ranking first on the A-share market. Its latest market capitalization stands at 589.5 billion yuan. Since the beginning of the year, GigaDevice's share price has surged nearly 300%, while its Hong Kong-listed shares have seen a staggering increase of 667.50%.
It is worth noting that on June 27th, according to public information, the globally popular memory ETF—Roundhill Memory ETF (DRAM)—included A-shares of GigaDevice in its portfolio for the first time, with a weighting of 2.91%, directly making it the 8th largest holding. In the view of many industry insiders, this move signifies that Chinese memory industry chain companies are gaining recognition from global passive funds.
According to Wind data, several other indices and their tracking ETF products also have significant exposure to GigaDevice. For instance, GigaDevice is the top constituent stock of the SZSE Chip Index, with a weight of 10.1566%. Currently, there are four ETFs linked to this index, with a total size of 47.191 billion yuan. In the CSI Chip Industry Index, GigaDevice is the second-largest constituent stock, accounting for 8.11%, and the ETFs linked to this index also have a combined size approaching 10 billion yuan.
Inclusion by a Top Global Memory ETF Fuels the Rally
On June 29th, memory chip leader GigaDevice continued its strong performance, closing at 840 yuan with a daily gain of 9.09%, close to the limit-up. The trading volume reached a record high of 43.15 billion yuan since its listing, topping the A-share market for daily turnover.
Since the start of the year, GigaDevice's stock has experienced explosive growth, with its A-shares surging 292.64% cumulatively. The performance of its Hong Kong-listed shares has been even more astonishing, with a year-to-date increase of 667.50%.
Notably, GigaDevice's trading volume has continued to expand recently, remaining above 37 billion yuan for multiple consecutive trading days. This indicates sustained and intensifying investor enthusiasm for the memory chip leader.
On the news front, the Roundhill Memory ETF, known as the "world's hottest memory ETF," recently released its latest holdings data. It included A-shares of memory chip leader GigaDevice for the first time, with a weight of 2.91%, making it the 8th largest holding. This marks the first inclusion of an A-share memory stock since the ETF's launch on April 2nd this year, and it is the only A-share memory chip company in its portfolio.
The Roundhill Memory ETF, or DRAM, is a rare pure-play actively managed memory ETF in the US market. It precisely focuses on core AI infrastructure memory categories such as DRAM, HBM, NOR Flash, and NAND, with clear screening criteria requiring that over half of a constituent's revenue comes from memory chip business. Since its launch on April 2nd, the fund's latest assets under management have reached $24.43 billion, with returns exceeding 160% since inception. It has become one of the most outstanding performing and fastest-growing newly launched ETF products in recent years.
The DRAM ETF's holdings are highly concentrated. According to the latest disclosed data as of June 28th, the three global memory giants—Samsung Electronics, Micron Technology, and SK Hynix—collectively account for over 75% of the weight, remaining the core holdings. Among them, Samsung Electronics is the top holding with a 25.80% weight, followed by Micron Technology and SK Hynix with weights of 25.45% and 24.56%, respectively.
Industry observers point out that the inclusion of GigaDevice by DRAM, a benchmark pure-memory thematic global ETF, signifies that China's domestic memory industry chain is gaining recognition from global active funds.
High Exposure in These ETFs: Analysts Warn of Risks and Opportunities
In fact, several other A-share ETF products also have significant exposure to GigaDevice.
For example, the SZSE Chip Index primarily selects the top 30 companies by total market capitalization from listed chip industry firms, after excluding the bottom 20% by trading volume. According to Wind data, GigaDevice is the index's largest constituent stock with a weight of 10.1566%. As of June 29th, the SZSE Chip Index has gained 90.96% year-to-date, rising 5.07% on the day.
There are four ETF products linked to this index: Chip ETF Huaxia, Semiconductor ETF Penghua, Chip ETF GF, and Semiconductor Leader ETF ICBC. The largest among them is the Chip ETF Huaxia with a size of 33.612 billion yuan.
Another example is the CSI Chip Industry Index, where GigaDevice is the second-largest constituent with a weight of 8.1110%. Year-to-date, the CSI Chip Industry Index has also surged 92.76%, gaining 5.43% on the day and rising 32.42% for the month.
There are six ETFs linked to this index, with a total size of 9.829 billion yuan. Among them, products like Chip ETF E Fund, Chip ETF Fullgoal, and Chip ETF Eastmoney have sizes exceeding 2 billion yuan each.
Beyond these, several other indices have exposure weights to GigaDevice exceeding 5% or even 10%. Some indices that include GigaDevice are tracked by products with considerable total assets under management.
Industry insiders simultaneously caution that the memory chip sector is highly cyclical. The recent sharp rally has pushed valuations to historically high levels, making valuation volatility risks impossible to ignore. For market participants, it remains crucial to continuously monitor core indicators such as industry supply-demand data and corporate earnings performance to rationally navigate the cyclical market fluctuations.
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