We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Time for Semiconductor ETFs on Senate's CHIPS-Plus Bill Passage?
Read MoreHide Full Article
A bipartisan bill to boost U.S. semiconductor manufacturing and bolster U.S. competitiveness with China has been okayed in a Senate vote. This cleared the set-up for final passage in the chamber. The vote passed 64-32.
The package, known as “CHIPS-plus,”includes roughly $52 billion in funding for U.S. companies producing computer chips, among other provisions. President Joe Biden during a meeting at the White House pressed Congress to “pass this bill as soon as possible.”
Senator John Cornyn, R-Tex., is the lead author of the bill, and said recently that no advanced semiconductors are currently manufactured in the United States, as quoted on etf.com. If American companies cannot acquire those advanced semiconductors, gross domestic product would decline by 3.2%, and the resulting loss could be three times worse than the effects of the current chip shortage, which recorded $240 billion in GDP lost last year, he added, per the etf.com article.
The “CHIPS-plus” package, has a provision that offers a tax credit for investment in chip manufacturing. It also offers funding to promote the innovation and development of other U.S. technologies. Supporters of the bill hope Congress will clear it and send it to President Joe Biden for his signature before the August recess, which is due in two weeks.
Meanwhile, the latest report from the Semiconductor Industry Association (SIA) highlights the same. The global semiconductor industry saw a 21.1% year-over-year surge in sales to $50.9 billion in April 2022. The metric also compared favorably with the March 2022 figure of $50.6 billion as it was 0.7% higher than the same (read: Bet on Top-Ranked Semiconductor ETFs Amid Surging Sales).
The metric might have received support from the chip companies, increasing their production capacities to manage accelerated demand amid the global chip supply shortage. According to the SIA report, there was a 40.9% year-over-year rise in semiconductor sales in the Americas, 19.2% surge in Europe, 18.5% increase in Japan and an 18.1% rise in the Asia Pacific/All Other followed by a 13.3% jump in sales in China.
Against this backdrop, below we highlight a few semiconductor ETFs that could gain ahead. Several of semiconductor ETFs currently hold a Zacks ETF Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold).
iShares Semiconductor ETF follows the ICE Semiconductor Index and offers exposure to 30 firms. The fund has amassed $7.15 billion in its asset base. It charges 43 basis points (bps) in fees a year from investors. It sports a Zacks ETF Rank #1, with a High-risk outlook.
This fund provides exposure to 25 securities by tracking the MVIS US Listed Semiconductor 25 Index. The product managed assets worth $6.65 billion and charges 35 bps in annual fees and expenses. The fund currently carries a Zacks ETF Rank #1, with a High-risk outlook.
This fund seeks investment results that correspond generally to the price and yield, before fees and expenses, of the Nasdaq US Smart Semiconductor Index. FTXL has accumulated $81.9 million of AUM. The expense ratio is 0.60%. FTXL presently has a Zacks ETF Rank of 2 (Buy).
Invesco Dynamic Semiconductors ETF (PSI)
This fund tracks the Dynamic Semiconductor Intellidex Index, holding 32 securities in its basket. The product has AUM of $570.6 million. The expense ratio is 0.56%. PSI sports a Zacks ETF Rank #2 at present, with a High-risk outlook.
This fund tracks the S&P Semiconductor Select Industry Index. The fund has AUM of $1.0 billion. It charges 35 bps in fees per year. The product has a Zacks ETF Rank #1 presently, with a High-risk outlook.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Time for Semiconductor ETFs on Senate's CHIPS-Plus Bill Passage?
A bipartisan bill to boost U.S. semiconductor manufacturing and bolster U.S. competitiveness with China has been okayed in a Senate vote. This cleared the set-up for final passage in the chamber. The vote passed 64-32.
The package, known as “CHIPS-plus,”includes roughly $52 billion in funding for U.S. companies producing computer chips, among other provisions. President Joe Biden during a meeting at the White House pressed Congress to “pass this bill as soon as possible.”
Senator John Cornyn, R-Tex., is the lead author of the bill, and said recently that no advanced semiconductors are currently manufactured in the United States, as quoted on etf.com. If American companies cannot acquire those advanced semiconductors, gross domestic product would decline by 3.2%, and the resulting loss could be three times worse than the effects of the current chip shortage, which recorded $240 billion in GDP lost last year, he added, per the etf.com article.
The “CHIPS-plus” package, has a provision that offers a tax credit for investment in chip manufacturing. It also offers funding to promote the innovation and development of other U.S. technologies. Supporters of the bill hope Congress will clear it and send it to President Joe Biden for his signature before the August recess, which is due in two weeks.
Meanwhile, the latest report from the Semiconductor Industry Association (SIA) highlights the same. The global semiconductor industry saw a 21.1% year-over-year surge in sales to $50.9 billion in April 2022. The metric also compared favorably with the March 2022 figure of $50.6 billion as it was 0.7% higher than the same (read: Bet on Top-Ranked Semiconductor ETFs Amid Surging Sales).
The metric might have received support from the chip companies, increasing their production capacities to manage accelerated demand amid the global chip supply shortage. According to the SIA report, there was a 40.9% year-over-year rise in semiconductor sales in the Americas, 19.2% surge in Europe, 18.5% increase in Japan and an 18.1% rise in the Asia Pacific/All Other followed by a 13.3% jump in sales in China.
Against this backdrop, below we highlight a few semiconductor ETFs that could gain ahead. Several of semiconductor ETFs currently hold a Zacks ETF Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold).
ETFs in Focus
iShares Semiconductor ETF (SOXX - Free Report)
iShares Semiconductor ETF follows the ICE Semiconductor Index and offers exposure to 30 firms. The fund has amassed $7.15 billion in its asset base. It charges 43 basis points (bps) in fees a year from investors. It sports a Zacks ETF Rank #1, with a High-risk outlook.
VanEck Semiconductor ETF (SMH - Free Report)
This fund provides exposure to 25 securities by tracking the MVIS US Listed Semiconductor 25 Index. The product managed assets worth $6.65 billion and charges 35 bps in annual fees and expenses. The fund currently carries a Zacks ETF Rank #1, with a High-risk outlook.
First Trust Nasdaq Semiconductor ETF (FTXL - Free Report)
This fund seeks investment results that correspond generally to the price and yield, before fees and expenses, of the Nasdaq US Smart Semiconductor Index. FTXL has accumulated $81.9 million of AUM. The expense ratio is 0.60%. FTXL presently has a Zacks ETF Rank of 2 (Buy).
Invesco Dynamic Semiconductors ETF (PSI)
This fund tracks the Dynamic Semiconductor Intellidex Index, holding 32 securities in its basket. The product has AUM of $570.6 million. The expense ratio is 0.56%. PSI sports a Zacks ETF Rank #2 at present, with a High-risk outlook.
SPDR S&P Semiconductor ETF (XSD - Free Report)
This fund tracks the S&P Semiconductor Select Industry Index. The fund has AUM of $1.0 billion. It charges 35 bps in fees per year. The product has a Zacks ETF Rank #1 presently, with a High-risk outlook.