Defiance ETFs has launched a new exchange-traded fund (ETF) that combines two increasingly important layers of AI infrastructure—memory and optical connectivity—in a single U.S.-listed fund.
The Defiance Memory & Photonics ETF (BATS:PRAM) tracks the Solactive Memory and Photonics Index, which selects the 20 largest eligible companies by free-float market capitalization and equally weights them. The index covers memory semiconductors, storage and networking chips, as well as optoelectronics.
The fund’s launch comes as AI infrastructure spending increasingly shifts beyond processors. AI models require enormous amounts of data to be stored, retrieved and moved rapidly between chips and servers.
Memory Becomes an AI Bottleneck
The memory industry has emerged as a major beneficiary of the AI buildout, particularly through demand for high-bandwidth memory (HBM) used alongside advanced AI accelerators.
PRAM’s portfolio includes SK Hynix Inc (NASDAQ:SKHY), Micron Technology, Inc (NASDAQ:MU), Nanya Technology (OTC:NNYAF), Winbond Electronics, SanDisk Corp (NASDAQ:SNDK) and Macronix International. SK Hynix has highlighted strong demand for HBM, AI server DRAM, and enterprise SSDs, while the broader industry is preparing for sustained AI-driven memory demand.
That demand is also driving capacity expansion. SK Hynix has planned a $4 billion advanced packaging facility in Indiana, with HBM4E production targeted for 2029.
The opportunity extends beyond HBM. AI servers are increasing demand for conventional DRAM and high-capacity storage, creating a broader memory-cycle tailwind.
Photonics — Another Side of the AI Infrastructure Equation: Moving Data
LightCounting expects 800G optical-transceiver shipments to more than double in 2026, while 1.6T shipments are projected to reach tens of millions of ports from a small 2025 base.
As AI clusters grow larger, electrical interconnects face limitations around bandwidth, distance and power consumption. Optical technologies are increasingly being deployed to connect GPUs, switches and data-center infrastructure.
PRAM’s photonics exposure includes Lumentum Holdings Inc (NASDAQ:LITE), while its broader semiconductor holdings include Marvell Technology Inc (NASDAQ:MRVL), which plays a role in high-speed connectivity.
The combination creates a different AI infrastructure trade: memory stores and feeds the data; photonics moves it.
A Global Supply Chain
PRAM also highlights how international the AI hardware supply chain remains. Eleven of its 20 holdings are listed outside the U.S., with significant exposure to Taiwan.
Its top 10 constituents include Nanya Technology (5.79%), Marvell (5.68%), Sandisk (5.47%), Winbond (5.35%) Lumentum (5.35%), Macronix (5.25%), Jeju Semiconductor (5.22%), Micron (5.21%), Innodisk (5.21%) and SK Hynix (5.16%).
With AI spending increasingly constrained by memory capacity, bandwidth and data movement, PRAM gives investors a targeted way to access two infrastructure bottlenecks that sit behind the headline GPU trade.
Photo: JHVEPhoto / Shutterstock
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