The semiconductor industry has had a solid year so far after a stellar 2024. Sales have skyrocketed, driven largely by booming demand for artificial intelligence and broad industry adoption.

Chipmakers have seen revenues climb sharply over the last two quarters, and the third quarter has also started on a positive note. In fact, semiconductors have been a major force behind the tech rally that has lifted the broader market.

Given the positive momentum, investing in mutual funds that focus on semiconductors — such as T. Rowe Price Science & Tech (PRSCX Quick QuotePRSCX - Free Report) , Fidelity Select Technology Portfolio (FSPTX Quick QuoteFSPTX - Free Report) and DWS Science and Technology A (KTCAX Quick QuoteKTCAX - Free Report) — could be a strategic investment move.

Chip Sales Continue to Rise

Global semiconductor sales reached $62.1 billion in July 2025, up 20.6% from a year ago and 3.6% higher than June’s $59.9 billion, the Semiconductor Industry Association (SIA) said last week. Regional growth was also robust, with year-over-year sales up 35.6% in Asia Pacific/All Other, 29.3% in the Americas and 19.4% in China.

These gains follow a solid second quarter, when global sales totaled $179.7 billion, up 7.8% from the previous quarter. While sales briefly slowed earlier this year over fears that U.S. tech companies could lose ground to China’s budget AI platform, DeepSeek, those concerns quickly faded after analysts dismissed it as overhyped. Growth has since resumed steadily.

The first two quarters of 2025 have seen steady growth in semiconductor sales after global revenues surged 19.1% in 2024 to $627.6 billion, compared with $526.8 billion in 2023.

Much of this expansion is being fueled by rising demand for data center processors and memory chips. With AI investment still accelerating, analysts predict that the semiconductor industry will maintain double-digit growth through the rest of 2025.

3 Best Choices

We have, thus, selected three mutual funds with significant exposure to semiconductor producers. These funds carry a Zacks Mutual Fund Rank #1 (Strong Buy) or 2 (Buy) and are poised to gain from the above factors. Moreover, these funds have encouraging three- and five-year returns. Additionally, the minimum initial investment is within $5000.

We expect these funds to outperform their peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance but also on the likely future success of the fund.

The question here is: why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).

T. Rowe Price Science & Tech fund seeks to invest in long-term capital growth by investing at least 80% of net assets in common stocks of companies expected by T. Rowe Price to benefit from the development, advancement, and use of science and technology. While most of PRSCX’s assets are invested in U.S. common stocks, other securities may also be purchased, including foreign stocks, futures, and options, in keeping with the fund’s objectives.

T. Rowe Price Science & Tech has a track record of positive total returns for over 10 years. Specifically, PRSCX’s returns over the three and five-year benchmarks are 27.1% and 15.2%, respectively.  PRSCX’s annual expense ratio of 0.79% is lower than the category average of 1.05%. PRSCX has a Zacks Mutual Fund Rank #1.

To see how this fund performed compared to its category, and other #1 or 2 Ranked Mutual Funds, please click here.

Fidelity Select Technology Portfolio fund seeks capital appreciation by investing most of its assets in common stocks of companies principally engaged in offering, using, or developing products, processes, or services that will provide or benefit significantly from technological advances and improvements.

Specifically, Fidelity Select Technology Portfolio’s returns over the three and five-year benchmarks are 27.4% and 18.8%, respectively. FSPTX carries a Zacks Mutual Fund Rank #1 and has an annual expense ratio of 0.62%, which is lower than the category average.

To see how this fund performed compared to its category, and other #1 and 2 Ranked Mutual Funds, please click here.

DWS Science and Technology A fund seeks growth of capital. Under normal circumstances, KTCAX invests at least 80% of its net assets in common stocks of U.S. companies in the technology sector.

DWS Science and Technology A fund has a track record of positive total returns for over 10 years.  Specifically, KTCAX’s returns over the three and five-year benchmarks are 27.6% and 17.4%, respectively. DWS Science and Technology A fund has a Zacks Mutual Fund Rank #1 and an annual expense ratio of 0.88, which is lower than the category average of 1.03%.

To see how this fund performed compared to its category and other #1 or 2 Ranked Mutual Funds, please click here.

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