iShares Semiconductor ETF

Broad exposure to the U.S. semiconductor value chain: chip designers, manufacturers, and equipment makers. Modified cap-weighting limits individual stock concentration.

Why This Week?

Semiconductors are the backbone of the AI revolution — and SOXX gives you the broadest exposure across the entire value chain. Unlike SMH, which is heavily concentrated in Nvidia and TSMC, SOXX uses modified cap-weighting that limits individual stock dominance. With ~99% YTD returns in 2026, ~24% allocation to equipment makers provides a defensive buffer. It's the 'picks and shovels' play across the entire chip ecosystem.

Key Metrics

YTD Return

~99%

1Y Return

~166%

Expense Ratio

0.34%

Holdings

~30

Dividend Yield

~0.22%

AUM

$47B

Top Holdings

8 holdings shown. Weights are approximate.

#NameWeight

MUMicron Technology

~12%

AMDAMD

~9%

MRVLMarvell Technology

~8%

INTCIntel

~6%

AVGOBroadcom

~6%

AMATApplied Materials

~6%

NVDANVIDIA

~5%

TXNTexas Instruments

~5%

Pros & Cons

Strengths

Explosive growth potential — direct play on AI, data centers, and digital infrastructure
Modified cap-weighting avoids excessive concentration in any single mega-cap
~24% equipment maker exposure adds defensive diversification within the sector
Strong liquidity and well-established fund with 20+ years of history
Covers the full semiconductor value chain (~30 companies)

Risks & Weaknesses

Extremely high volatility — semiconductors are deeply cyclical
Very concentrated in one sector with no industry diversification
Low dividend yield (~0.22%) — purely a growth play
Only ~30 holdings — limited stock-level diversification
Geopolitical risk from U.S.-China chip tensions and export controls
Cap-weighting limits may underweight the largest winners like NVIDIA

Alternatives Comparison

ETF	Name	TER	Focus
SOXXThis Week	iShares Semiconductor ETF	0.34%	Broad exposure to the U.S. semiconductor value chain: chip designers, manufacturers, and equipment makers. Modified cap-weighting limits individual stock concentration.
SMH	VanEck Semiconductor ETF	0.35%	More concentrated, heavier Nvidia/TSMC weighting, includes global names
SOXQ	Invesco PHLX Semiconductor ETF	0.19%	Lowest cost semiconductor ETF, similar holdings
XSD	SPDR S&P Semiconductor ETF	0.35%	Equal-weighted, more small/mid-cap exposure

💬 Frequently Asked Questions

Driven by explosive demand for AI chips and digital infrastructure. Semiconductors are the backbone of the AI revolution, and companies across the value chain — designers, manufacturers, and equipment makers — are all benefiting from massive capital expenditure cycles exceeding $700B.

SOXX uses a modified cap-weighted index that limits individual stock concentration, while SMH is more top-heavy with larger allocations to mega-caps like NVIDIA. SOXX includes ~24% in equipment makers providing a defensive buffer. SMH includes global companies like TSMC and ASML that SOXX doesn't.

Semiconductors are a secular growth industry, but the sector is highly cyclical with potential for severe drawdowns. SOXX is best as a satellite/thematic position (10-20% of portfolio), not a core holding. Long-term investors need high risk tolerance.

The ICE Semiconductor Index uses modified market-cap weighting with caps to prevent any single stock from dominating. This provides better risk-adjusted diversification but means you may underweight the largest winners.

SOXQ at 0.19% is significantly cheaper than SOXX at 0.34%. For long-term buy-and-hold investors, SOXQ's fee advantage compounds meaningfully over time. SOXX offers higher liquidity and the iShares brand.

Yes! SOXX has over 20 years of history and is available in our backtester. You can compare it against SMH, SOXQ, or any other ETF in our database to see how different semiconductor strategies would have performed.

Want to Explore Further?

SOXX launched recently, so try backtesting SMH or SOXX as semiconductor proxies, or explore our ETF database for alternatives.

Backtest SMH + SOXX ETF Explorer

Disclaimer: ETF of the Week is educational content only. It is not investment advice, a recommendation to buy or sell, or an endorsement of any fund. Past performance does not guarantee future results. Always do your own research and consult a financial advisor before investing.