Invesco’s Semiconductor ETF Rallies on Strong TSMC Earnings

TSMC’s strong sales outlook prompted a rally in semiconductor stocks on Thursday. The company raised annual revenge growth expectations, an optimistic signal for investors. 

Investors looking to add exposure to TSMC and other semiconductor stocks may consider the Invesco PHLX Semiconductor ETF (SOXQ B+). The fund is up around 2.5% in midday trading Thursday, buoyed by the rally in semiconductor stocks.

TSMC is a top-four holding in SOXQ, weighted 4.4% as of Oct. 16. The other top names include Nvidia, Broadcom, and Advanced Micro Devices. 

SOXQ is based on the PHLX Semiconductor Sector Index, which measures the performance of the 30 largest U.S.-listed securities of companies engaged in the semiconductor business. 

Semiconductors include products such as memory chips, microprocessors, integrated circuits, and related equipment that serve a wide variety of purposes in various types of electronics, including personal household products, automobiles, and computers, among others.

Semiconductors are the backbone of the technology sector, according to VettaFi’s Head of Sector and Industry Research Roxanna Islam. Growth in the semiconductor industry has been accelerated by greater connectivity. Additionally, data centers, which support the growth of cloud computing and artificial intelligence, have also been a hot topic among investors recently, according to Islam.

See more: Semiconductor ETFs: Not-So-Shocking Growth

SOXQ has climbed 24.1% year to date through Oct. 16 and 48.4% over a one-year period. The semiconductor ETF has climbed 66.4% since its inception in June 2021.

The fund charges 19 basis points, placing it among the lowest-priced ETFs in the category. Invesco’s semiconductor ETF has $498 million in assets under management. SOXQ has accreted $265 million in net flows year to date through Oct. 16, as investors have continued to add exposure to the space.

For more news, information, and analysis, visit the Innovative ETFs Channel.