5 Best ETFs To Buy Now

1. VanEck Semiconductor ETF (NASDAQ GM: SMH)

5-year Share Price Performance as of March 9, 2024: 323.63%

VanEck Semiconductor ETF (NASDAQ GM: SMH) ranks 1st on our list of the best ETFs to buy. VanEck Semiconductor ETF (NASDAQ GM: SMH) aims to closely replicate the price and yield performance of the MVIS US Listed Semiconductor 25 Index, which tracks companies specializing in semiconductor production and equipment. Established on December 20, 2011, the ETF had net assets of $17.32 billion as of March 8, 2024, along with an expense ratio of 0.35%.

VanEck Semiconductor ETF (NASDAQ GM: SMH)’s largest holding is NVIDIA Corporation (NASDAQ:NVDA). On February 22, NVIDIA Corporation (NASDAQ:NVDA) declared a $0.04 per share quarterly dividend, in line with previous. The dividend is payable on March 27, to shareholders on record as of March 6. 

According to Insider Monkey’s fourth quarter database, 173 hedge funds were bullish on NVIDIA Corporation (NASDAQ:NVDA), compared to 180 funds in the last quarter. Rajiv Jain’s GQG Partners is the biggest stakeholder of the company, with 13.90 million shares worth $6.8 billion. 

SaltLight Capital stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its fourth quarter 2023 investor letter:

“We were fortunate to have some exposure to some of the ‘Magnificent Seven’ – Amazon, NVIDIA Corporation (NASDAQ:NVDA), Meta Platforms and Google (although in aggregate, we still hold a smaller weighting than the S&P 500).

While we are cautious in AI infrastructure, we do think there are mispriced opportunities in areas of application software where AI can be infused to make a step change improvement. Posted in our office is this chart that ASML provides at each of its investor days. This chart is a little outdated from 2021, but we think illustrates how value (in operating profit) was distributed across semiconductors, hardware, and then software & services. It’s very clear that most of the economic value in the past has accrued to the software services (in gray) built on the backs of highly technical companies run by extremely smart people.

Why is this? We think it is due to a combination of distribution and network effects. Our working hypothesis right now is that this will likely remain a similar outcome in the AI epoch. One outlier right now is Nvidia which is capturing 80% margins..” (Click here to read the full text)

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