2024-03-25 02:58:19 ET
Summary
- iShares Semiconductor ETF gained 33% since July 2023, driven mostly by the AI story and strong demand for Nvidia's chips.
- Other companies like Micron, AMD, and Broadcom are also expected to benefit from the proliferation of AI in the industry.
- This proliferation factor is the reason that this time around, it is SOXX, which appears better positioned than SMH, which is more concentrated in Nvidia's shares.
- Also, the chip market is expected to recover in 2024, but caution is advised due to potential volatility related to interest rates not being cut in June.
- There is also the possibility of geopolitical risks with China escalating because of the forthcoming elections.
Semiconductors did well in 2024 with the iShares Semiconductor ETF ( SOXX ) gaining 33% since I last covered it in July last year. At that time, I had a neutral position mostly because of demand softness, high inventories especially for memory, and Chinese authorities imposing export restrictions on a key ingredient used to make chips....
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SOXX: Gain Broader AI Exposure, Amid Chip Recovery