Mirae Asset launches world's first on-device AI ETF

The AI ecosystem encompasses major companies in cloud AI and on-device AI. [MIRAE ASSET GLOBAL INVESTMENTS]

The catchphrase "AI Everywhere" signifies the era of “on-device AI,” where AI technology is embedded in all products and services, becoming part of everyday life.

If ChatGPT, released in 2022, is a representative example of AI cloud — the amalgamation of cloud computing and AI — used by people around the world, we are now on the brink of an era where we use personalized AI in smartphones, home appliances and TVs.

On-device AI refers to AI computations performed within the device itself, such as a smartphone. Up until now, this technology has been utilized exclusively for features such as facial recognition and night mode on cameras.

Advancements in semiconductor technology have enabled the installation of AI capable of understanding human language. On-device AI is reaching beyond smartphones to PCs, TVs and even automobiles.

One may inquire about which corporations to invest in considering the on-device AI era. The answer is to pay close attention to neural processing units (NPUs).

NPUs are chips created through the collaborative efforts of semiconductor companies and AI firms, designed to rapidly process inference computations. The chip prioritizes the quick calculation of viable answers over extensive data input and is characterized by its compact size and optimized power efficiency. While the focus has previously been on using GPUs to train AI, the future promises an era of AI inference via NPUs.

As AI becomes more integrated into our daily lives, the demand for inference computation — generating responses to user requests — will far exceed that of training computation.

As the NPU market expands, semiconductor intellectual property (IP) companies are also on the rise. For the timely design of customized NPUs, utilizing verified circuit design blocks provided by the IP companies is essential.

A renowned company in this area is ARM. Some 99 percent of the world’s mobile processors, including those from Qualcomm and Apple, are based on ARM’s instructions.

In the midst of such phenomena, Mirae Asset Global Investments launched the world's first “TIGER Global On-Device AI exchange-traded fund (ETF)” in April, which focuses on investments in NPU and IP companies.

While existing semiconductor or AI ETFs have centered their portfolios around Nvidia, this product focuses on the expanding NPU market as AI becomes more integrated into everyday lives.

The ETF invests heavily in companies like Qualcomm, Intel and Apple, as well as IP companies such as ARM, Synopsys and Cadence.

"The AI development competition that began with the release of ChatGPT in 2022 brought about explosive demand for GPUs,” said Kim Byung-seok, manager of the ETF Management Division at Mirae Asset Global Investments.

“However, starting this year, the NPU market is expected to grow. In the era of on-device AI, we anticipate that the TIGER Global On-Device AI ETF will become a product that invests in the next Nvidia,” he said.

BY JEONG SEONWU [jeong.seonwu@joongang.co.kr]

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