Shinhan Asset Management "‘SOL US AI Power Infrastructure’... Strong Returns"

Shinhan Asset Management announced on the 22nd that the ‘SOL US AI Power Infrastructure’ exchange-traded fund (ETF) ranked first among 37 domestic AI-related ETFs with returns of 28.43% and 34.34% over the past 1 month and 3 months, respectively.

Junghyun Kim, Head of the ETF Business Division at Shinhan Asset Management, said, “The need to respond to the rapidly increasing power demand in the US is an area where bipartisan consensus between the Democratic and Republican parties has been formed, and power infrastructure construction is progressing rapidly in the US. Among energy sources, nuclear power and SMR (Small Modular Reactor) are particularly highlighted.” He added, “The SOL US AI Power Infrastructure ETF focuses on solutions to power shortages in the AI era.”

Big tech companies operating data centers that produce and store the new commodity AI have long shown great interest in nuclear power to secure the electricity needed to operate them, and recent contracts are becoming visible.

Following the power purchase agreement (PPA) signed in September this year between Microsoft and Constellation Energy for a 20-year power supply, Google signed a contract with Kairos Power on the 15th of this month for SMR construction and power supply. Amazon also announced a total of three agreements supporting SMR development and construction, including with Energy Northwest and Dominion Energy, creating an atmosphere where nuclear power is establishing itself as a key power source in the AI era.

Kim said, “US data centers are concentrated in specific regions, and power outages cause enormous financial losses, so power must be supplied without interruption. Nuclear power can be produced independently without regional constraints such as sunlight or wind and records a stable operating rate, making it well-suited to data centers.” He added, “Big tech companies are particularly paying attention to the fact that SMRs can bring greater efficiency in terms of site utilization.”

The SOL US AI Power Infrastructure ETF is a product that allows balanced investment in each sector: △nuclear value chain (43.4%) △power grid system equipment (32.9%) △data center infrastructure (23%).

Kim emphasized, “Since SMRs are a future technology and their performance is not yet visible, individual stock investments may be exposed to high volatility, so investing through ETFs is efficient. Due to the visibility of AI, the US power demand forecast is being significantly revised upward, and considering the urgent need to replace aging infrastructure, it is important to pay attention to the US government’s announcement of a $900 million scale construction and support plan for next-generation nuclear technology in the mid to long term.”

This content was produced with the assistance of AI translation services.