(Bloomberg) — For most of its six-year run, the Defiance Quantum ETF behaved like any other tech longshot. Outsized returns and lack of investor interest meant it remained stuck among a smattering of exchange-traded funds. landscape.
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Everything changed in a matter of nanoseconds after Google's parent company, Alphabet Inc., announced a major advance in quantum computing earlier this month. Flows to the fund, which trades under the ticker QTUM, are currently at an all-time high.
QTUM, which is designed to track stocks in companies related to quantum computing, has received about $250 million in inflows so far in December, according to data compiled by Bloomberg. It is said to be on track for its largest monthly cash income since its launch in 2018. . It rose 17% during this period. Prior to this year, QTUM had earned $164 million net since its inception.
The influx started to pick up earlier this month following news that Alphabet had achieved significant results in quantum computing through the use of Willow quantum chips. The company said its quantum computer can solve problems in just five minutes that would take a supercomputer about 1 billion years. Alphabet's stock price rose on the announcement, and other stocks related to quantum computing have continued to rise in recent days.
“Quantum is having the same moment that AI had last year. Many quantum stocks are not widely held by ETFs, making QTUM really the only pure trade,” Bloomberg Intelligence's Athanasios・Psarofagis said. “I wouldn’t be surprised if we see more quantum-related applications in the near future.”
Quantum computing involves using the mechanics of quantum physics to create more powerful computers. These computers can do things that standard computers cannot, such as modeling complex collections of items that involve many inputs and moving parts. Experts in the field expect these computers to bring breakthroughs and advances in fields ranging from drug development to financial modeling.
QTUM tracks an index made up of companies including Alphabet and Nvidia Corp., along with companies like D-Wave Quantum Inc., Rigetti Computing Inc., and IonQ Inc.. Quantum computers in 2011 increased by more than 800% this year and Righetti by more than 1,000%.
