Can Semiconductor ETFs Continue To Shine In 2024?

Semiconductor stocks surged this year, thanks to the AI Bonanza, as these companies provide picks and shovels for the AI gold rush. Semiconductor ETFs are also the best-performing ETFs of the last 10 years, as chips—the basic building blocks of computation—have become integral in everything from smartphones to cars, laptops, PCs, video games, and data centers.Shares of Nvidia (NVDA – Free Report), which currently holds more than 85% of the market for generative-AI chips, are up more than 240% this year. However, the stock has taken a breather since topping $500 in August, while some others, like Advanced Micro Devices (AMD – Free Report) and Broadcom (AVGO – Free Report), have risen lately.Despite the eye-popping surge, Nvidia now trades at just 25 times forward earnings, the lowest level since the end of 2018, according to top semiconductor analyst Stacy Rasgon.Earlier this month, AMD introduced its newest AI chips that could provide some competition to Nvidia’s H100. Microsoft (MSFT Quick QuoteMSFT – Free Report) and Meta (META Quick QuoteMETA – Free Report) said they will use AMD’s MI300 chip. Intel (INTC Quick QuoteINTC – Free Report) also announced it will launch its Gaudi3 AI chip next year.The VanEck Vectors Semiconductor ETF (SMH Quick QuoteSMH – Free Report) follows a market cap weighted index of 25 US-listed semiconductor companies. Nvidia and Taiwan Semiconductor (TSM Quick QuoteTSM – Free Report) are its top holdings.The iShares PHLX Semiconductor ETF (SOXX Quick QuoteSOXX – Free Report) is a modified market cap weighted ETF. It has 30 holdings with a cap of 8% on individual securities. Broadcom and AMD are its top holdings.The SPDR S&P Semiconductor ETF (XSD Quick QuoteXSD – Free Report) is an equal weighted ETF. The Invesco PHLX Semiconductor ETF (SOXQ Quick QuoteSOXQ – Free Report) is now the cheapest product in the space.To learn more about these stocks and ETFs, please watch the short video above.Video Length: 00:13:18More By This Author:ETF Market Outlook & Investing Strategies For 2024ETF Investing Strategies For 2024Top ETF Stories Of 2023


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