Global X Innovative Bluechip Top 10 ETF (3422)
Full exposure to some of the most attractive growth and innovation themes, such as AI, semiconductors, electric vehicles, and biotech.
By holding only the 10 quality stocks, investors can have direct exposure to the global leaders.
Our portfolio embodies the characteristics and advantages of bluechip stocks, with positive operating margins, ROA and ROE.
Megatrend technologies, like EVs and AI, require substantial capital expenditures for development. Microsoft plans to invest around US$32bn this year2, primarily driven by AI investments. Amazon allocates over US$50bn annually for e-commerce2, cloud, and AI infrastructure. TSMC expects to invest over US$30bn this year2, surpassing Intel, Globalfoundries, and UMC combined. The technology gap between TSMC and competitors widens, with TSMC ahead in transistor density on the current roadmap. Smaller companies may struggle due to limited financial resources, hindering their ability to compete with larger blue-chip companies. This concentration of resources favors the established players.
AI is rapidly transforming industries, offering lucrative investment prospects. Generative AI, particularly large language models, stands to revolutionize business operations, benefiting leading providers.
Companies with large AI models offer API services, enabling application development atop their models and cloud services. Pricing varies, such as OpenAI's DALL·E charging US$0.02 per generated image3. Hyperscale Cloud providers like Google and Amazon also offer AI capabilities as APIs, with distinctions in task types and capabilities. This API access to large AI models presents ample innovation opportunities.
The conversational AI market provides a useful comparison, with a projected 37% CAGR, reaching US$16bn by 20264. Cloud-based solutions are expected to grow at a higher CAGR (51.8%), validated by Microsoft's ChatGPT on Azure. This fuels growth prospects for Microsoft, Google, Amazon, and data center supply chain players.
The semiconductor industry is crucial for AI, providing high-performance computing and specialized hardware accelerators. NVIDIA dominates the data center GPU market with over 80% market share5, positioning them to benefit from the AI investment cycle. Server processor revenue is projected to grow at a 21% CAGR, reaching US$105.5bn by 2027. NVIDIA's success in AI training GPUs is attributed to its comprehensive software stack, CUDA, and competitive chip performance through in-house GPU architecture like Hopper and Tensor Core technology, designed for accelerated AI model training.
Global vehicle electrification transition is a clear trend forward for passenger vehicles. EV penetration continues to move up across key economies globally, MS project BEV (Battery powered electric vehicle) to cross-over with ICE (Internal combustion engine vehicle) sometime in the 2030s, we are only in the early days of EV revolution as global EV penetration is still below 15% at the moment.
CATL is the leader in R&D expenditure among battery pure plays followed by Samsung SDI. R&D spending continues to increase with leading companies spending 6% of revenue on R&D6, which is similar to leading EV makers. CATL spent US$4.8bn over the past 5 years in R&D which is greater than the next 5 Chinese battery makers combined. CATL annual R&D spending is 2x leading Korean battery makers. In patents, Chinese companies dominate in LFP and Na-ion while Koreans focus more on solid state and Si-anode.
Among the top six battery makers, CATL has a relative lead for patents across the different battery chemistries. BYD has a slight lead over CATL on number of LFP patents. LGES has a strong position for high nickel, silicon anodes, solid state and lithium sulphur batteries. SDI is also similarly strong across silicon anodes and for next generation batteries. Both SK On and Panasonic have a relatively average portfolio compared to peers.
Eli Lilly, a prominent biopharmaceutical company, boasts a favorable outlook with no major Loss of Exclusivities (LoEs) on the horizon. Its strong growth is attributable to blockbuster products. Positioned as a key leader in the GLP-1 market, Eli Lilly has revolutionized diabetes treatment with its next-generation insulins and GLP-1 therapies. Beyond weight loss, these therapies target various co-morbid conditions such as sleep apnea, osteoarthritis, heart failure, kidney disease, and cardiovascular diseases. One of the product has exhibited robust progress since its launch and holds the potential to become a mega-blockbuster in cardio-metabolic indications. Analysts predict significant sales for Eli Lilly's GLP-1 drugs, estimating that the overall GLP-1 class could generate sales of US$110bn by 2033, with Eli Lilly's drugs contributing US$65bn to obesity and diabetes sales.
With upcoming catalysts in its pipeline, Eli Lilly is well-positioned to sustain its above-market sales growth and solidify its standing as one of the fastest-growing companies in the industry. The company's innovative therapies and positive growth trajectory make it a formidable player in the biopharmaceutical landscape.
Stock Code | 3422 (HKD) # |
Underlying Index | Mirae Asset Global Innovative Bluechip Top 10 Index * |
Ongoing Charges Over A Year^ | 0.68% |
Inception Date | 24 Nov 2023 |
# Investment involves risk. Before making any investment decision to invest in the Fund, investors should read the Fund’s Prospectus for details and the risk factors. Visit Global X ETFs Hong Kong website for more details relating to this Fund (including but not limited to the Fund’s iNAV, market price, performance, daily holdings and tracking difference / error).
* The Underlying Index is a net total return, equal weighted index. A net total return index reflects the reinvestment of dividends or coupon payments, after deduction of any withholding tax (including surcharges for special levies, if applicable).
^ The Fund adopts a single management fee structure, whereby a single flat fee will be paid out of the assets of the Fund to cover all of the costs, fees and expenses of the Fund. Click [?] to learn more.