5 Best Semiconductor ETFs

2. VanEck Semiconductor ETF (NASDAQ:SMH)

5-year Share Price Performance as of March 13: 329.24%

VanEck Semiconductor ETF (NASDAQ:SMH) aims to replicate the price and yield performance of the MVIS® US Listed Semiconductor 25 Index. This index is designed to monitor the overall performance of companies engaged in semiconductor manufacturing and equipment. As of March 12, 2024, VanEck Semiconductor ETF (NASDAQ:SMH)’s net assets amount to $18.07 billion, along with an expense ratio of 0.35%. The ETF was established on December 20, 2011. It is one of the best semiconductor ETFs to invest in. 

ASML Holding N.V. (NASDAQ:ASML) is one of the top holdings of VanEck Semiconductor ETF (NASDAQ:SMH). ASML Holding N.V. (NASDAQ:ASML) saw increased demand from China in 2023, but future gains might be impacted by potential domestic substitutions, according to Bernstein Research. Despite this, Bernstein anticipates a 3% growth in the wafer fab equipment market to $97 billion in 2024, partly due to delays in capital expenditures by Taiwan Semiconductor Manufacturing. Bernstein raised its price target on ASML Holding N.V. (NASDAQ:ASML) to $1,072 from $963 and maintained an Outperform rating on the stock on March 11. 

According to Insider Monkey’s fourth quarter database, 62 hedge funds were bullish on ASML Holding N.V. (NASDAQ:ASML), compared to 57 funds in the prior quarter. 

Polen International Growth Strategy stated the following regarding ASML Holding N.V. (NASDAQ:ASML) in its fourth quarter 2023 investor letter:

“Netherlands-based ASML Holding N.V. (NASDAQ:ASML) and Japan-based Lasertec play dominant roles within different segments of the global semiconductor industry. In both cases, shares rallied significantly in the fourth quarter of 2023, prompting our positions to grow as a percentage of the overall portfolio. We believe both companies will see demand for their products as extreme ultraviolet (EUV) lithography and soon high-numerical aperture lithography must be utilized to manufacture the world’s smallest chips. However, in our estimation, 2024 could deliver a year of less exciting growth for the semiconductor industry, which prompted us to trim these positions back.”

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