iShares Semiconductor ETF

SOXX

Market cap $25.4B

SOXX has been a beneficiary of the AI-driven data center supercycle, with the ETF delivering an outsized +210.2% return since the launch of ChatGPT in late 2022. The ETF's balanced weighting in US-based AI leaders like NVDA, AVGO, and MU provides diversified exposure to hyperscaler-driven growth while mitigating geopolitical/capex risks. SOXX trades at an elevated P/E of 43.73x, albeit with top holdings nearing 5Y P/E means and offering high double/triple-digit growth prospects, supporting robust capital appreciation.

Three semiconductor ETFs are competing for the same investor dollar in 2026, each built on a different philosophy for capturing growth in the chip industry.

iShares Semiconductor ETF earns a buy rating, driven by hyperscaler capex and direct exposure to the AI infrastructure buildout. SOXX's top holdings—NVDA, AVGO, MU, and AMD—are positioned to benefit from $1.15T in hyperscaler capex, with contracts already signed. Blended earnings growth for SOXX's top 10 holdings is projected at 32–38%, outpacing modeled multiple compression and supporting a 17% base case total return.

Following a recent ceasefire that has boosted market morale, tech stocks have experienced a notable rebound. Brook Dane, Goldman Sachs Asset Management's co-head of public tech investing, discusses his strategy for investing in tech stocks amid the relief rally.

A smart beta exchange traded fund, the iShares Semiconductor ETF (SOXX) debuted on 07/10/2001, and offers broad exposure to the Technology ETFs category of the market.

Semis rallied with the support of tailwinds, but they reversed course when the same tailwinds turned into headwinds in Q1 2026. Semis lost most of their gains as they headed into Q2 2026 and it could have been worse if not for the prospect of something that may not be attainable. Q2 2026 is likely to see increased volatility, unless a resolution is found to the Middle East and the uncertainty hanging over semis is lifted.

Quantum computing has moved from theoretical research into a genuine commercial race. IBM has unveiled quantum processors with over 1,000 qubits, while Google has achieved error-corrected quantum computation with logical qubits. Enterprises are beginning to integrate quantum capabilities into hybrid production workflows alongside existing AI infrastructure, and McKinsey projects the quantum computing market could reach $850 billion by 2040. For investors, the question is how to get exposure to this transition without concentrating entirely in early-stage companies whose timelines remain uncertain.

SOXX is focused solely on semiconductors, while FTEC covers the entire technology sector with nearly 10 times as many holdings. FTEC has a much lower expense ratio but has lagged SOXX on recent one-year and five-year total returns.

The iShares Semiconductor ETF holds 30 of the world's top semiconductor stocks, and it has averaged returns of 30% per year over the last decade. Its largest holdings include Micron, Nvidia, and Advanced Micro Devices, which are three of the most important suppliers of AI chips and components.

Iran's strike on Qatar slashes helium supply, raising fears of chip disruption but also hinting at semiconductor ETF buying opportunities.