Kudosz Top 5 Ratings ⭐⭐⭐⭐⭐
The best semiconductor Exchange-Traded Funds (ETF) to buy in 2026, driven by high demand from the AI sector, include the VanEck Semiconductor ETF (SMH) for industry concentration, and the iShares Semiconductor ETF (SOXX) or Invesco PHLX Semiconductor ETF (SOXQ) for broader, standard market-cap exposure. These funds provide access to major chip giants like Nvidia, TSMC, and Broadcom.
Top Semiconductor ETFs to Buy
- VanEck Semiconductor ETF (SMH) ( expense ratio): Highly concentrated in the largest 25 U.S.-listed semiconductor companies, with over
in the top 10 holdings, making it a strong play on AI winners.
- iShares Semiconductor ETF (SOXX) ( expense ratio): Tracks the PHLX Semiconductor Sector Index, offering a balanced, market-cap-weighted portfolio of 30 industry leaders.
- Invesco PHLX Semiconductor ETF (SOXQ) ( expense ratio): A low-cost alternative that tracks the same index as SOXX (PHLX), providing similar exposure for a lower fee.
- SPDR S&P Semiconductor ETF (XSD) ( expense ratio): Uses a modified equal-weight strategy, reducing dependence on largest caps like NVIDIA and offering more exposure to mid- and small-cap winners.
- Invesco Semiconductors ETF (PSI) ( expense ratio): Focused on growth, it often includes a momentum factor, favoring companies positioned for future market leadership.
Key Considerations
- Expense Ratios: SOXQ is one of the cheapest options, while sector-specific, actively managed, or specialized ETFs may charge more.
- Concentration Risk: SMH is very top-heavy, favoring top-performing firms like Nvidia, while XSD is better for diversification.
- Leveraged ETFs: Options like the Direxion Daily Semiconductor Bull 3X ETF (SOXL) are available for active, short-term betting on, or against, the industry but carry high risk due to daily compounding.
* Disclaimer: Kudosz is not a financial advisor and our Top 5 Best-Rated ratings are not financial advice. This information is for educational purposes only and does not constitute financial advice. Doing business with any providers noted is at your own risk.