State Street SPDR S&P Semiconductor ETF

XSD

Market cap $2.8B

You saw the tweets, the CNBC hits, and the chart that looked like a ladder to the moon.

If you own SPDR S&P Semiconductor ETF (NYSEARCA:XSD) because you wanted “semiconductor exposure,” the fund's 0.35% expense ratio is the least interesting number attached to your account.

Semiconductor stocks have dramatically outperformed, with the AI infrastructure boom fueling historic gains and broadening leadership beyond Nvidia. Micron's 800% rally and $1T valuation highlight memory's dominance, and tight supply dynamics and insatiable demand are expected to persist into FY2027.

Nvidia remains central to the AI revolution, with Vera Rubin in full production and demand for AI compute accelerating. Recent volatility in semiconductor stocks reflects skepticism, but fundamentals and valuations across leaders like Nvidia, Micron, Broadcom, and AMD remain robust.

There are an increasing number of financial articles and viral social media posts comparing the current rally in AI and semiconductor chips to the dotcom-era bubble. They highlight the same pattern: a sharp correction, a vertical recovery, and then full-blown euphoria.

Semiconductor ETFs came under pressure Tuesday as a sharp sell-off in South Korea's technology sector spilled over into U.S. chip stocks, raising concerns about the durability of the artificial intelligence-driven rally ahead of a closely watched earnings report from Micron Technology Inc (NASDAQ:MU).

A $10,000 position in the SPDR S&P Semiconductor ETF (NYSEARCA:XSD) at the close on Thursday was worth roughly $8,873 by Friday's close, and the people who got there did not own a single share of the stock that supposedly caused it.

The SPDR S&P Semiconductor ETF (NYSEARCA:XSD) and the iShares Semiconductor ETF (NASDAQ:SOXX) look like interchangeable ways to own the chip cycle, but they differ in one fundamental way.

For much of the past year, Wall Street has debated whether the semiconductor rally is a once-in-a-generation earnings cycle or bubble.

A share of the SPDR S&P Semiconductor ETF (NYSEARCA:XSD) closed at $226.42 on May 29, 2025.