nextbigtrade
Stage Analysis Trader, Creator of Next Big Trade Premium Newsletter
The FOTO photonics ETF likely marks the top of the 2023-2026 AI bull run, since sector ETFs launched after big moves signal institutions selling the public what it wants, well past the time to buy. It saw monster distribution volume and a failed move higher in its second week, and LYTE, LAZR and LUMA launching at the same time adds to the top signal. x.com x.comÂ
The Tema Photonics & Optical ETF is the best way to own photonics, better than EUV and FOTO, as the only truly actively managed, institutional-quality photonics ETF. Its top holdings are Lumentum, AXT and Aixtron, and Tema partnered with SemiAnalysis to deliver pure-play exposure to leading-edge photonics and optics, a critical path in the AI buildout. Wall Street analysts see a $60 price target, 50% upside over 12 months. x.comÂ
Defiance's photonics ETF is a good tracker for photonics because it covers the whole supply chain, from indium phosphide to equipment, lasers and modules. Its top holdings fit: Lumentum is the best InP laser maker, AXT benefits as the InP shortage worsens, and Aixtron makes the MOCVD machines that produce lasers. Recent earnings showed the sector sold out, with long-term agreements removing cyclicality. Rival ETFs focus too narrowly on transceivers, so this suits a set-and-forget approach. x.com … Show more
The Tuttle Capital Pure Play Photonics ETF is the purest high-beta basket on the optical interconnect and photonics supply chain in US markets. It holds companies earning at least half their revenue or operating profit from photonics, spanning AI data-center optical modules, coherent optical communications, lasers, optical manufacturing and test and measurement, which is why diversified names like Nokia and Marvell are excluded. It is tiny, with about $500,000 in assets after three trading days. … Show more
Lumentum supplies optical components inside every AI data center, and that demand remains relentless. x.comÂ
Lumentum and Coherent are investments driven by product iteration, while AXT is a bottleneck trade best treated as speculation. Shortage-driven price hikes on the same parts define a cyclical stock, prices quickly discount shortage expectations, and once profits truly climb it is time to exit. Bottlenecks also push customers to design around them and invite new entrants. Investable companies keep lifting margins through yield gains and new products, driving token deflation while growing revenue. … Show more
LYTE, a newly launched photonics ETF, is worth owning as a more targeted photonics play than the EUV ETF. Its top holdings are Sivers Semiconductors, Applied Optoelectronics, Lumentum and Coherent. x.comÂ
Tema Photonics & Optical ETF offers a way to hold a range of optical companies without trading the volatile individual names. Its roughly 9% exposure to an Anthropic SPV adds to the appeal. The ETF is thinly traded; the idea is to buy and hold for a year rather than keep trading. x.com x.comÂ
Memory stocks may be at a local top, because the launch of a new 2x leveraged ETF on a sector, such as RAM tracking the Roundhill Memory ETF, has had an uncanny ability to mark local tops. x.comÂ
Lumentum requires paying up heavily for a company that is not yet making money. Revenue grew 109% year over year, but it trades at about 25 times annualized sales, and it is growing less than memory makers at ten times their valuation. @ZeekTyt cites Lumentum's CEO expecting to supply only about 30% of requested laser demand as CPO and NPO ramp in 2027, with balance around 2029-30. x.com x.comÂ
Applied Optoelectronics makes optical transceivers for data-center networks, which AI scaling needs. x.comÂ
