Direxion launched two leveraged semiconductor ETFs in October targeting the five largest companies driving the chip industry’s rally, offering investors amplified exposure to a sector concentrated in artificial intelligence infrastructure.
The Direxion Daily Semiconductors Top 5 Bull 2X Shares (TSXU) and Top 5 Bear 2X Shares (TSXD) track an equal-weighted index of Nvidia Corp. (NVDA), Advanced Micro Devices Inc. (AMD), Broadcom Inc. (AVGO), ASML Holding (ASML), and Taiwan Semiconductor Manufacturing Co. (TSM), according to ETF Database.
Both funds are part of Direxion’s Titans Leveraged & Inverse ETFs lineup, which targets the top five companies in specific sectors with daily leverage. The funds carry a 0.97% expense ratio. They seek to deliver twice the daily performance or inverse performance of the underlying index.
The top five semiconductor companies have captured outsized gains as data center operators race to build AI computing capacity. TSXU’s holdings show AMD at 8.3%, ASML at 8%, TSM at 6.6%, and Broadcom at 6.4%, according to ETF Database.
Demand for AI chips continues driving revenue growth across the group, with TSM raising its 2025 revenue guidance by roughly 30% amid accelerating orders, according to a Direxion report citing Reuters.
ASML dominates advanced lithography equipment production, positioning it to benefit from global fabrication plant construction, according to Direxion research. Government subsidies supporting domestic chip manufacturing in the U.S. and Europe represent another tailwind for the sector.
Sector Faces Risks Despite Growth
Yet the semiconductor industry’s concentration also exposes the funds to elevated risks. U.S. export restrictions limiting Chinese access to advanced chips have created uncertainty for companies with significant China exposure, according to Direxion research.
Manufacturing capacity expansion could outpace near-term demand outside data centers, the research highlights. Valuations across semiconductor leaders have climbed as investors price in continued AI infrastructure spending, leaving little room for earnings disappointments.
For traders anticipating these risks, TSXD provides bearish exposure or a hedge against semiconductor positions. Both funds reset leverage daily, making them designed for short-term tactical trades rather than long-term holdings.
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