Key points
- The Roundhill Memory ETF (DRAM) holds $627.5M of CXMT through a total return swap, a 2.52% weight.
- CXMT has no US listing. The swap references 78.4M shares and matures in May 2027.
- There was no CXMT line in the fund's July 23 file. CXMT listed July 27 and closed day one up 465.82%.
- GigaDevice, the fund's first China position, is down to 1.51% and is now the smaller of the two.
The Roundhill Memory ETF (DRAM) holds $627.5 million of ChangXin Memory Technologies, the Chinese memory maker that listed in Shanghai on July 27. The position appears in the fund's holdings file dated August 2, on a line reading CXMT CORPORATION-SWAP-GOLD-L, at a 2.52% weight. The file dated July 23 has no CXMT line in it.
CXMT priced its IPO at 8.66 yuan a share and raised 57.92 billion yuan before the overallotment, about $8.6 billion, the largest mainland offering since Agricultural Bank of China in 2010. It closed its first session at 49 yuan, up 465.82%, which made it the most valuable company listed on the mainland, ahead of Industrial and Commercial Bank of China. Its prospectus puts its 2025 share of the global DRAM market at 7.67%.
The stock trades under the code 688825 on the Shanghai STAR Market. There is no US listing and no ADR.
At a 2.52% weight, $1,000 in DRAM carries about $25 of CXMT exposure, and $10,000 carries about $252.
How a US fund owns a stock that does not trade here
It does not own the stock. The line in the holdings file is a total return swap, a contract with a bank that pays the fund whatever the shares would have paid. The file writes it against 78,447,045 CXMT shares, with a May 2027 maturity and the same counterparty tag the fund already carries on part of its Samsung Electronics and SK Hynix exposure.
Roundhill gives its own reason for using swaps. "The Fund utilizes total return swaps in order to maintain compliance with RIC diversification tests," the fund's FAQ page says, referring to the tax rules a regulated investment company has to meet to avoid being taxed at the fund level.
The fund has no voting stock and no claim on CXMT itself. If the bank on the other side of the contract fails, the fund is one of its creditors. The collateral sits in the same file: 14.47% of the fund, $3.60 billion, is in the First American Government Obligations Fund.
What it does to GigaDevice
GigaDevice Semiconductor entered the fund in late June at a 2.91% weight as its first Chinese holding. It is now 1.51%, worth $376.0 million, and smaller than the CXMT swap.
The two are not independent companies. Zhu Yiming founded GigaDevice in 2005 and CXMT in 2016 and is chairman of both. CXMT manufactures the DRAM and GigaDevice develops and sells it, and GigaDevice put about $825 million of DRAM purchases from CXMT and its parent to a shareholder vote this year. GigaDevice was the listed way into that business for as long as CXMT was private. It is not the only one now.
The rest of the fund
The August 2 file lists 23 lines and $24.55 billion in assets. These are the ten largest positions.
| Position | Weight | Value |
|---|---|---|
| Samsung Electronics | 26.39% | $6.57B |
| Micron (MU) | 24.54% | $6.11B |
| SK Hynix | 22.77% | $5.67B |
| Seagate (STX) | 5.05% | $1.26B |
| Western Digital (WDC) | 4.98% | $1.24B |
| Sandisk (SNDK) | 3.76% | $936.5M |
| Kioxia | 3.14% | $781.7M |
| CXMT | 2.52% | $627.5M |
| Nanya Technology | 1.92% | $476.8M |
| GigaDevice | 1.51% | $376.0M |
Samsung and SK Hynix appear as their Seoul listings, 005930 and 000660, combined with the swaps written on them. SK Hynix also has a separate 0.49% line in its US-listed ADR (SKHY), which is not in the 22.77% above. Winbond, Phison and Macronix fill out the bottom of the file at under 1% each.
What the listing did to the price
DRAM closed at $58.30 on July 23, the last file before CXMT appeared in it. It closed at $44.85 on July 29, down 23.1% in four sessions, then recovered to $50.37 on July 31. That is 37.6% below its record close of $80.72 on June 22, and still well above the $27 it opened at on its first day, April 2.
On July 31 Micron closed at $823.03, Sandisk at $1,214.83 and the SK Hynix ADR at $143.73, all lower on the day. In Seoul, foreign investors sold a net 2.9039 trillion won of Kospi stocks on July 27, and the two they sold most were SK Hynix and Samsung Electronics.
Roundhill launched DRAM on April 2, calling it the first-ever memory stock ETF. Dave Mazza, CEO of Roundhill Investments, put its purpose this way in the launch announcement. "Memory is moving to the center of the AI ecosystem. As AI scales in size and complexity, the demand for high-performance memory has become a key constraint on the pace of AI development. DRAM is designed to give investors targeted exposure to the companies supplying that layer of the AI stack, in a way broad semiconductor funds simply do not."
This is general market commentary and opinion, not investment advice. Markets can go down as well as up, and you can lose money. Always do your own research and consider speaking with a licensed financial professional before making any investment decision.
