Even More Explosive Than 2x Leverage! This ETF Soared 418% in One Year — Ruan Mu-Hua Reveals Two Key Traits: Positioned at the Heart of the 'AI Blood Vessels'

In just one year, the net asset value of this ETF skyrocketed from 9.8 yuan to 50.8 yuan—a staggering 418% increase—eclipsing even 2x leveraged products. The current wave of AI is gradually revealing a core truth: AI has officially moved beyond mere 'computing power' into the era of 'bandwidth.' NVIDIA’s entry into the dark fiber market and Alphabet’s massive capital expenditure expansion in its latest quarter underscore this shift. Financial expert Ruan Mu-Hua stated on Facebook: 'No matter how many GPUs you have or how large your models are, if data gets stuck in transit, everything is meaningless.' He emphasized that optical communication—the bottleneck in AI’s next stage of development—is now the most critical indicator amid the global correction in AI-related stocks.

Breaking Free from Copper Delays and Overheating: Google’s Massive Investment Proves 'Optical Communication Is the Vein of the AI Era'

Ruan Mu-Hua points out that the core of AI data transmission lies in overcoming 'copper.' Traditionally, data traveled through copper wires, but at AI’s massive scale, copper causes delays, high power consumption, and overheating. 'Light advances, copper retreats' has become the most certain industry trend in recent years. Whether it’s interconnecting data centers, synchronizing thousands of GPUs, or enabling 5G high-speed backhaul, optical communication forms the essential 'highway'—truly the lifeblood of the AI era.

This trend is not just rhetoric. On July 22, Alphabet, Google’s parent company, reported its latest quarterly results (Q2 2026), with capital expenditures soaring to $44.9 billion—a more than 100% year-on-year increase. Its annual forecast was also raised to between $195 billion and $205 billion, with about 40% directly allocated to data centers and network equipment. CEO Sundar Pichai personally highlighted the 'Virgo Network' project, aiming to link millions of AI accelerators across multiple data centers into a single unified supercomputer. Synchronizing millions of chips scattered across different server rooms relies entirely on optical communication—a clear signal sent with real money: the next bottleneck in AI is how data is transmitted.

Soaring 418% in One Year to Dominate the Market: 00877 Grows Like a Snowball Thanks to 'No Dividends' and 'High Purity'

Riding the wave of optical communication, the Fu-Hua China 5G Communication ETF (00877) has delivered extraordinary performance. Ruan Mu-Hua notes that 00877 has charted a trajectory few ETFs can match: its NAV rose from 9.8 yuan to 50.8 yuan in about a year—a 418% gain—with a near-one-year return of 170%, securing the top spot among all ETFs (excluding futures-linked) in 2025.

Ruan identifies two key competitive advantages of 00877:

'No Dividend' Mechanism: In a high-growth sector, this becomes an advantage. All earnings are fully reinvested, creating a powerful compounding snowball effect—delivering returns that surpass even many 2x leveraged products.

Extremely 'High Purity' Holdings: Tracking the CSI 5G Communication Theme Index, it is almost fully invested in optical communication—covering everything from fiber optics, optical modules, transceivers, to high-speed chips across the upstream and downstream supply chain. It sits right at the epicenter of AI capital expenditure, with index performance clearly outpacing other major Chinese indices.

Looking ahead, research firms estimate the overall optical communication and networking market will grow at a CAGR of 7.5% to 8.6%. Upstream silicon photonics could reach nearly 29% CAGR, while CPO (Co-Packaged Optics) approaches 31%, indicating strong ongoing demand for components supporting the 'veins of AI.' 00877 is perfectly positioned at the heart of this supply-demand gap.

From 50.8 Yuan Down to 37 Yuan: Could This Correction Be the Launchpad for the Next Surge?

Ruan acknowledges that despite its stellar historical performance, 00877 has extremely high holding concentration and carries an RR5 risk rating, meaning volatility will be significant. Investors still need to do their homework. Recently, global AI supply chain stocks collectively plunged, affecting 00877 as well—its price dropped from a peak of 50.8 yuan to around 37 yuan recently, a substantial correction. However, if the overarching trend in optical communication remains unchanged, this pullback may actually mark the starting point for the next upward leg. Amid the global AI stock correction, optical communication stocks will be the most crucial indicators.