We have touched on the SEMI ETF in recent weeks, a vehicle which provides investors with exposure to a portfolio of leading global semiconductor companies, including chip designers, manufacturers and equipment suppliers such as Nvidia, TSMC, Broadcom and ASML – a collection of companies lacking on the ASX. The ETF offers an easy way for Australians to invest in the infrastructure underpinning the AI, data centre and digitalisation boom without moving offshore, although we note the ETF is unhedged, hence investors are holding largely $US assets so a weak Greenback will and has dragged on performance.
The ETF costs 0.45% pa, which we believe represents solid value for the exposure to the basket of ~30 overseas AI Infrastructure stocks. However, the FX exposure has been a drag on performance with its benchmark, the Solactive Global Semiconductor 30 Index, up ~78% year-to-date, while the SEMI ETF has only advanced +70.5% due to the strong Australian Dollar – still a great return!
- We can see the SEMI ETF powering above $45 after the SpaceX IPO is in the rear-view mirror, and hopefully the Iran confrontation.
MM is bullish on the SEMI ~$40
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