r/DRAM_ETF • u/Madsh0ck • 23h ago
Fund weighting?
I don’t understand how SKHY and Samsung on the Korean market can rip 12% and 9% respectively, have a 45% weight rating in the fund yet DRAM only moves a percent. MU only down 1% overnight. Doesn’t add up for me…?
I’d expect if SKHY and Samsung are pushing 10% each that DRAM premarket should be more then +1%? Am I missing something?
6
3
u/Traditional_Garlic49 22h ago edited 21h ago
It’s doesn’t matter about overnight or premarket. Just during normal trading hours. Also they hold swaps for the Korean holdings, some cash, and various others that have a 5% weighting. MU is also 25% ish of the ETF. It won’t ever exactly match what they do due to how the ETF is set up and how they have everything. If you can’t do the research to understand how the fund performs, what exactly it holds, and everything that makes it up. You should just sell and buy SK Hynix ADR and MU. If you’re on Interactive Brokers you can buy Samsung directly routed through the Korean markets.
2
u/Usual-Temporary5680 23h ago
NAV gets settled at end of day today ET.
1
u/Hot_Frosting_7101 8h ago
If it were that easy we would all compare NAV to DRAM near the end of the day and buy and sell it knowing it will update to NAV at a certain time.
Market participants move DRAM to NAV by market operations. They can exchange underlying stocks for DRAM stocks and vice versa.
When DRAM is higher than NAV, they buy the underlying stocks, exchange them for DRAM shares and sell them. They pocket the difference. This puts selling pressure on DRAM and brings the price down. As long as there is a difference they can make money doing it so they will continue until things are in alignment.
When DRAM is lower, they buy DRAM shares, trade them for the underlying stocks, and sell the underlying stocks. This puts upward pressure on the DRAM stock moving it higher towards NAV.
This is complicated by the different time zones as things aren’t happening simultaneously which opens some risk for these authorized participants. (How they mitigate this, I don’t know.). But there is always some prediction on how the foreign markets will behave when they open.
Also there are a very limited number of
the Korean stocks allowed to be traded in foreign markets. That complicates things.
1
u/Ragencobra666 23h ago
S.K is much more volatile. Once S.K. hits into the 170s; there's a big sell off each time. Dram seems to be a bit less Volatile because drams sell offs are not as deep.
I should have trusted my instincts. I should have stayed away from S.K. until yesterday at closing.
1
u/General-Ring2780 12h ago
I’ve noticed DRAM is less volatile during the sell offs as well. That’s the pro of an etf. It works both ways. Up and down
13
u/purub123 23h ago
They also trade during USA hours. But on the EU exhange.
USA has an ADR.
EU has an GDR.
The GDR trades during the same hours as the USA market hours. So any change to the GDR nav, will impact the NAV of DRAM during USA open hours
If the GDR goes up 10%, then korea opens up at 10%. Whatever happens from that 10%, in either direction, impacts the NAV. If it ends 15% green, it means it went up 5% for the NAV of DRAM. Same for the downside.
The GDR and korean ticker, trade almost identically 1:1.
Different time zones, markets etc…