Key Points
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The iShares Semiconductor ETF (NASDAQ: SOXX) has delivered a return of 1,150% over the past decade, outpacing the S&P 500 by four times.
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Top holdings include Micron Technology (8.82%), Advanced Micro Devices (7.43%), and Nvidia (7.37%), which together account for 23.6% of the fund’s total value.
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Investing $500 per month could potentially grow to $1 million in as little as 14 years, based on varying annual returns up to 27.3%.
The iShares Semiconductor ETF has proved to be a strong investment option, attributed largely to the growing demand for AI chips and components, particularly from leading companies such as Micron, AMD, and Nvidia. The ETF focuses exclusively on U.S.-listed semiconductor firms, paralleling the boom in AI technology and infrastructure, with Nvidia’s CEO projecting that data center operators may spend $4 trillion annually on AI infrastructure by 2030.
With a significant increase in equity allocations for the semiconductor sector, historical performance indicates that the industry offers substantial long-term returns. Investors should consider the ETF as a part of a diversified portfolio, given its concentrated holdings in critical players within the sector, driving potential for continued growth.
