Roundhill Launches Photonics and Optics ETF Amid Rapid Industry Growth

Roundhill Investments, the manager behind the successful Memory ETF (DRAM), is launching a new AI-themed investment vehicle called the Roundhill Photonics and Optics ETF (LYTE) on Thursday.

The new fund targets the photonics industry, which has seen significant growth due to the increasing demand for optical networking in AI data centers. Optical networking uses light pulses in fiber-optic systems rather than traditional electrical signals, offering faster, more energy-efficient data transmission over longer distances.

Nvidia, a leader in the field of AI computing, has committed at least $6.5 billion to companies developing photonics technology since March 2026 and is expected to release its Feynman GPU microarchitecture in 2028, which will utilize photonics instead of copper connections.

The photonics industry has seen rapid growth, with publicly-traded corporations specializing in the production of photonics technology experiencing significant increases in market capitalization. Shares of Lumentum have risen by over 100% this year, while Coherent and Nlight have also seen significant gains.