xETFs Launches AI Bottlenecks ETF Under NECK Ticker
The actively managed fund began trading Sept. 23 on NYSE Arca and focuses on companies tied to supply constraints across the artificial intelligence industry.
xETFs launched the AI Bottlenecks ETF under the ticker NECK on Sept. 23, giving U.S. investors a fund focused on companies linked to critical supply constraints across the artificial intelligence industry.
The actively managed ETF trades on NYSE Arca and targets five areas: memory; optics, photonics and networking; power and infrastructure; semiconductors and compute; and potential future bottlenecks.
NECK may periodically adjust its holdings as constraints ease, migrate or develop elsewhere in the AI supply chain. Its strategy focuses on inputs and infrastructure that may gain pricing power when demand exceeds supply.
“The AI buildout can only move as fast as its scarcest inputs allow,” Johnny Wu, co-founder and CEO of xETFs, said.
The fund’s selection process considers supply-and-demand conditions, the durability of competitive advantages, economic significance, pricing power and valuation. The strategy is designed to identify areas where infrastructure or other inputs could limit the pace of AI expansion.
NECK carries a gross expense ratio of 0.75% annually. It is classified as concentrated and non-diversified, meaning its investments may be less broadly spread across companies and industries than those of a diversified fund.
Exchange Traded Concepts, LLC is the fund’s investment adviser. WallStreetX ETFs Inc., doing business as xETFs, serves as sub-adviser.
The fund’s stated risks include changes in AI spending and technology, shifts in supply and demand, export controls, trade restrictions, energy constraints, geopolitical tensions and disruptions in technology supply chains. NECK may invest significantly in Asian issuers.
Its investment focus gives the fund exposure to companies involved in the infrastructure and inputs needed to support AI systems, while leaving the portfolio subject to changes in technology, trade policy and demand across the industry.
