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Best ETFs & Stocks from October's Top Performing Sector
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The technology sector has been leading this month buoyed by soaring FAANG stocks — Facebook , Amazon (AMZN - Free Report) , Apple (AAPL - Free Report) , Netflix (NFLX - Free Report) , and Alphabet GOOGL — and encouraging fundamentals like improved overseas demand, Trump’s tax reform plan and a rising interest rate scenario.
Notably, the semiconductor industry has been outperforming the broad sector buoyed by innovative technologies. New areas such as autonomous cars, cloud computing, gaming, wearables, VR headsets, drones, virtual reality devices, Internet of Things (IoT) and artificial intelligence are fueling exceptional growth in the industry, offsetting struggling traditional businesses like PCs and smartphones.
Further, the industry is benefiting from an astronomical surge in cryptocurrencies such as Bitcoin and Ethereum that has pushed semiconductor stocks to record highs. This is because mining of cryptocurrencies needs the usage of semiconductors. A hardware known as an ASIC (Application-Specific Integrated Circuit) has been designed exclusively for mining bitcoin (read: ETFs Riding High On Bitcoin Surge).
Moreover, the deluge of strong earnings reports from the major players such as Micron (MU - Free Report) , Texas Instruments (TXN - Free Report) , Intel (INTC - Free Report) , and Advanced Micro Devices Inc. (AMD - Free Report) added to the strength.
Given this, investors might want to tap the space with the top-performing semiconductor ETFs and stocks of this month. For them, we have highlighted four funds and stocks that are poised to perform well in the final two months of the year.
This fund offers exposure to the most-liquid U.S. semiconductor securities based on volatility, value and growth by tracking the Nasdaq US Smart Semiconductor Index. It holds 30 stocks in its basket with each holding less than 9% share. FTXL has accumulated $24.5 million in AUM and trades in average volume of around 8,000 shares. Expense ratio comes in at 0.60%. FTXL is up 8.9% in October and has a Zacks ETF Rank #2 (Buy).
PowerShares Dynamic Semiconductors Fund (PSI - Free Report)
This fund tracks the Dynamic Semiconductor Intellidex Index, holding 30 securities in its basket with none accounting for more than 5.6% share. The product has AUM of $357.3 million and sees a moderate average daily volume of 80,000 shares. It charges 63 bps in annual fees and has surged 8.1% this month. The product has a Zacks ETF Rank #1 (Strong Buy) (read: 5 Biggest ETF Winners of Trump Trade Resurgence).
This fund provides exposure to 26 securities by tracking the MVIS US Listed Semiconductor 25 Index. It is highly concentrated on the top two firms — Taiwan Semiconductor (TSM) and Intel — with a combined 19.4% of assets. The product has managed assets worth $1.1 billion and charges 36 bps in annual fees and expenses. It is heavily traded with a volume of around 3.1 million shares per day and has gained 7.8% this month. The fund has a Zacks ETF Rank #1.
This ETF follows the PHLX SOX Semiconductor Sector Index and offers exposure to 30 firms with each holding less than 9% of assets. The fund has amassed $1.4 billion in its asset base and trades in solid average volume of around 478,000 shares a day. It charges 48 bps in fees a year from investors and has gained 8.1% this month. It has a Zacks ETF Rank #1 (read: Semiconductor ETFs Touch New Highs Ahead of Q3 Earnings).
Best Stocks
We have highlighted the best-performing semiconductors stocks that currently have a Zacks Rank #1, or 2.
Based in Geneva, Switzerland, STMicroelectronics is a global independent semiconductor company which designs, develops, manufactures and markets a broad range of semiconductor integrated circuits and discrete devices used in a wide variety of microelectronic applications, including telecommunications systems, computer systems, consumer products, automotive products and industrial automation and control systems.
STMicroelectronics has a Zacks Rank #1 and belongs to a Zacks Industry Rank in the top 2%. With a market cap of $21.22 billion, the stock has seen positive earnings estimate revision of a couple of cents for this year over the past 30 days. It has returned 21.3% in October.
Based in Plano, TX, Diodes is a leading manufacturer and supplier of high-quality discrete and analog semiconductor products, primarily to the communications, computing, industrial, consumer electronics and automotive markets. With a market cap of $1.72 billion, the stock has seen solid earnings estimate revision of a dime this month for this year. It sports a Zacks Rank #1 and belongs to a Zacks Industry Rank in the top 41%. DIOD is up 12.7% this month (read: Here's What Investors Need to Know About Soaring Semiconductor ETFs).
Based in Santa Clara, CA, Intel is one of the world's largest semiconductor chip makers. It has seen solid earnings estimate revision of 15 cents this month for this year and has a Zacks Rank #1. Intel also belongs to a strong Zacks Industry Rank in the top 2%. It has $207.8 billion in market capitalization and has surged 16.5% this month.
Based in Malvern, PA, Vishay Intertechnology is one of the world's largest manufacturers of discrete semiconductors (diodes, MOSFETs, and infrared optoelectronics) and passive electronic components (resistors, inductors, and capacitors). With a market cap of $3.19 billion, the company has seen positive earnings estimate revision of four cents this month for this year. It has gained 14.9% and has a Zacks Rank #1 and belongs to a Zacks Industry Rank in the top 3%.
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Best ETFs & Stocks from October's Top Performing Sector
The technology sector has been leading this month buoyed by soaring FAANG stocks — Facebook , Amazon (AMZN - Free Report) , Apple (AAPL - Free Report) , Netflix (NFLX - Free Report) , and Alphabet GOOGL — and encouraging fundamentals like improved overseas demand, Trump’s tax reform plan and a rising interest rate scenario.
Notably, the semiconductor industry has been outperforming the broad sector buoyed by innovative technologies. New areas such as autonomous cars, cloud computing, gaming, wearables, VR headsets, drones, virtual reality devices, Internet of Things (IoT) and artificial intelligence are fueling exceptional growth in the industry, offsetting struggling traditional businesses like PCs and smartphones.
Further, the industry is benefiting from an astronomical surge in cryptocurrencies such as Bitcoin and Ethereum that has pushed semiconductor stocks to record highs. This is because mining of cryptocurrencies needs the usage of semiconductors. A hardware known as an ASIC (Application-Specific Integrated Circuit) has been designed exclusively for mining bitcoin (read: ETFs Riding High On Bitcoin Surge).
Moreover, the deluge of strong earnings reports from the major players such as Micron (MU - Free Report) , Texas Instruments (TXN - Free Report) , Intel (INTC - Free Report) , and Advanced Micro Devices Inc. (AMD - Free Report) added to the strength.
Given this, investors might want to tap the space with the top-performing semiconductor ETFs and stocks of this month. For them, we have highlighted four funds and stocks that are poised to perform well in the final two months of the year.
Best ETFs
First Trust Nasdaq Semiconductor ETF FTXL
This fund offers exposure to the most-liquid U.S. semiconductor securities based on volatility, value and growth by tracking the Nasdaq US Smart Semiconductor Index. It holds 30 stocks in its basket with each holding less than 9% share. FTXL has accumulated $24.5 million in AUM and trades in average volume of around 8,000 shares. Expense ratio comes in at 0.60%. FTXL is up 8.9% in October and has a Zacks ETF Rank #2 (Buy).
PowerShares Dynamic Semiconductors Fund (PSI - Free Report)
This fund tracks the Dynamic Semiconductor Intellidex Index, holding 30 securities in its basket with none accounting for more than 5.6% share. The product has AUM of $357.3 million and sees a moderate average daily volume of 80,000 shares. It charges 63 bps in annual fees and has surged 8.1% this month. The product has a Zacks ETF Rank #1 (Strong Buy) (read: 5 Biggest ETF Winners of Trump Trade Resurgence).
VanEck Vectors Semiconductor ETF SMH
This fund provides exposure to 26 securities by tracking the MVIS US Listed Semiconductor 25 Index. It is highly concentrated on the top two firms — Taiwan Semiconductor (TSM) and Intel — with a combined 19.4% of assets. The product has managed assets worth $1.1 billion and charges 36 bps in annual fees and expenses. It is heavily traded with a volume of around 3.1 million shares per day and has gained 7.8% this month. The fund has a Zacks ETF Rank #1.
iShares PHLX Semiconductor ETF SOXX
This ETF follows the PHLX SOX Semiconductor Sector Index and offers exposure to 30 firms with each holding less than 9% of assets. The fund has amassed $1.4 billion in its asset base and trades in solid average volume of around 478,000 shares a day. It charges 48 bps in fees a year from investors and has gained 8.1% this month. It has a Zacks ETF Rank #1 (read: Semiconductor ETFs Touch New Highs Ahead of Q3 Earnings).
Best Stocks
We have highlighted the best-performing semiconductors stocks that currently have a Zacks Rank #1, or 2.
STMicroelectronics N.V. (STM - Free Report)
Based in Geneva, Switzerland, STMicroelectronics is a global independent semiconductor company which designs, develops, manufactures and markets a broad range of semiconductor integrated circuits and discrete devices used in a wide variety of microelectronic applications, including telecommunications systems, computer systems, consumer products, automotive products and industrial automation and control systems.
STMicroelectronics has a Zacks Rank #1 and belongs to a Zacks Industry Rank in the top 2%. With a market cap of $21.22 billion, the stock has seen positive earnings estimate revision of a couple of cents for this year over the past 30 days. It has returned 21.3% in October.
Diodes Incorporated (DIOD - Free Report)
Based in Plano, TX, Diodes is a leading manufacturer and supplier of high-quality discrete and analog semiconductor products, primarily to the communications, computing, industrial, consumer electronics and automotive markets. With a market cap of $1.72 billion, the stock has seen solid earnings estimate revision of a dime this month for this year. It sports a Zacks Rank #1 and belongs to a Zacks Industry Rank in the top 41%. DIOD is up 12.7% this month (read: Here's What Investors Need to Know About Soaring Semiconductor ETFs).
Intel Corporation (INTC - Free Report)
Based in Santa Clara, CA, Intel is one of the world's largest semiconductor chip makers. It has seen solid earnings estimate revision of 15 cents this month for this year and has a Zacks Rank #1. Intel also belongs to a strong Zacks Industry Rank in the top 2%. It has $207.8 billion in market capitalization and has surged 16.5% this month.
Vishay Intertechnology, Inc. (VSH - Free Report)
Based in Malvern, PA, Vishay Intertechnology is one of the world's largest manufacturers of discrete semiconductors (diodes, MOSFETs, and infrared optoelectronics) and passive electronic components (resistors, inductors, and capacitors). With a market cap of $3.19 billion, the company has seen positive earnings estimate revision of four cents this month for this year. It has gained 14.9% and has a Zacks Rank #1 and belongs to a Zacks Industry Rank in the top 3%.
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Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>