Semiconductor Outperforms in 2019: 5 Best ETFs & Stocks

The technology sector has been the best-performing sector of 2019 and is heading toward having its best year in a decade driven by chipmakers, most of which saw triple-digit rally. Trade optimism has been the biggest catalyst as chip stocks have a lot of exposure to China. They derive a large portion of their revenues from China since it is the world’s biggest chip market and also have supply chains in the country.

As semiconductors have been the most important driver of the overall technology growth, it is now used in day-to-day life from cars, electronic gadgets to planes and weapons. Chipmakers power much of the world’s technology with their new innovation and set the stage for digitalization in various corners like healthcare, transport, financial systems, defense, agriculture, retail and many others (read: 4 ETFs to Invest in Soaring Semiconductor Stocks).

Robust demand for memory chips and other semiconductor products owing to the rapid adoption of cloud, Internet of Things, autonomous cars, gaming, wearables, VR headsets, drones, virtual reality devices, artificial intelligence, cryptocurrencies, and other advanced information technologies are fueling huge growth in the space. Additionally, the deployment of 5G (fifth-generation) technology — the next wireless revolution — is creating further opportunities. The wave of mergers and acquisitions provides further impetus to the space.

Given the bullish fundamentals, investors might want to tap the space with the top-performing semiconductor ETFs and stocks of this year. We have highlighted five of them.

Best ETFs

VanEck Vectors Semiconductor ETF SMH

This fund provides exposure to 25 semiconductor companies by tracking the MVIS US Listed Semiconductor 25 Index (read: 9 ETFs at the Forefront of 2019 Market Rally).

Zacks ETF Rank: #2 (Buy)
AUM: $1.5 billion
Expense Ratio: 0.35%
YTD Return: 68%

SPDR S&P Semiconductor ETF XSD

This fund provides equal-weight exposure to 36 chipmakers by tracking the S&P Semiconductor Select Industry Index.

Zacks ETF Rank: #2
AUM: $514.3 million
Expense Ratio: 0.35%
YTD Return: 65.6%

iShares PHLX Semiconductor ETF SOXX

This ETF offers exposure to 30 U.S. companies that design, manufacture, and distribute semiconductors by tracking the PHLX SOX Semiconductor Sector Index.

Zacks ETF Rank: #2
AUM: $2.4 billion
Expense Ratio: 0.46%
YTD Return: 63.2%

First Trust Nasdaq Semiconductor ETF FTXL

This fund offers exposure to the 30 most-liquid U.S. semiconductor securities based on volatility, value and growth by tracking the Nasdaq US Smart Semiconductor Index (read: 5 ETF Areas Up At Least 45% in 2019).

Zacks ETF Rank: #3 (Hold)
AUM: $43.6 million
Expense Ratio: 0.60%
YTD Return: 63%

Invesco Dynamic Semiconductors ETF PSI)

This fund follows the Dynamic Semiconductor Intellidex Index, holding 58 securities in its basket.

Zacks ETF Rank: #1 (Strong Buy)
AUM: $219.3 million
Expense Ratio: 0.58%
YTD Return: 53.3%

Best Stocks

Lattice Semiconductor Corporation LSCC

This company designs, develops and markets high performance programmable logic devices and related development system software.

Zacks Rank: #3
VGM Score: B
Market Cap: $2.57 billion
YTD Return: 177.9%

Cirrus Logic Inc. CRUS

This fabless semiconductor supplier develops, manufactures and markets analog, mixed-signal, and audio DSP integrated circuits (ICs).

Zacks Rank: #1
VGM Score: D
Market Cap: $4.82 billion
YTD Return: 151.2%

You can see the complete list of today’s Zacks #1 Rank stocks here.

Advanced Micro Devices Inc. AMD

It provides microprocessors (x86-based), chipsets, discrete graphics processing units (GPUs) and professional graphics (read: A Bunch of Top-Ranked ETFs That Crushed the Market in 2019).

Zacks Rank: #3
VGM Score: C
Market Cap: $51.4 billion
YTD Return: 150.2%

Inphi Corporation IPHI

This company is a provider of fabless high-speed analog semiconductor solutions for the communications and computing markets.

Zacks Rank: #3
VGM Score: B
Market Cap: $3.44 billion
YTD Return: 134.3%

Lam Research Corporation LRCX

This company supplies wafer fabrication equipment and services to the semiconductor industry.

Zacks Rank: #3
VGM Score: D
Market Cap: $42.6 billion
YTD Return: 115.7%

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Advanced Micro Devices, Inc. (AMD) : Free Stock Analysis Report
 
Lattice Semiconductor Corporation (LSCC) : Free Stock Analysis Report
 
Cirrus Logic, Inc. (CRUS) : Free Stock Analysis Report
 
First Trust NASDAQ Semiconductor ETF (FTXL): ETF Research Reports
 
iShares PHLX Semiconductor ETF (SOXX): ETF Research Reports
 
VanEck Vectors Semiconductor ETF (SMH): ETF Research Reports
 
SPDR S&P Semiconductor ETF (XSD): ETF Research Reports
 
Inphi Corporation (IPHI) : Free Stock Analysis Report
 
Lam Research Corporation (LRCX) : Free Stock Analysis Report
 
Pluralsight, Inc. (PS) : Free Stock Analysis Report
 
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