Internet of Things (IoT) connections could double to 26.4 billion by 2026 which is one of many categories that require semiconductors to operate.1
The world's next generation of innovative technology will require semiconductors to power it.
The realm of semiconductors extends far beyond personal computers, reaching an ever-multiplying number of devices and applications. SEMI invests accordingly, cutting across traditional sector and geographic definitions.
1 Ericsson, Jun 2021
Product Information As of 8 Dec 2023
27 Aug 2021
Management Costs (% p.a.)
Managed Investment Trust
NAV Information As of 8 Dec 2023
The Global X Semiconductor ETF (SEMI) seeks to invest in companies that stand to potentially benefit from the broader adoption of tech-enabled devices that require semiconductors. This includes the development and manufacturing of semiconductors.
The Global X Semiconductor ETF (SEMI) seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Solactive Global Semiconductor 30 Index.
SEMI AU Equity
10:00AM – 4:00PM
Management & Administration
Global X Management (AUS) Limited
The Hongkong and Shanghai Banking Corporation Limited, Sydney Branch
Semiconductors, or microchips, are like the brains behind electronic devices. They are in virtually every electronic device in existence: televisions, laptops, phones, microwaves, cars, rice cookers – and the rest. They are so ubiquitous that we usually forget they are there. Semiconductors manipulate the flow of electricity to produce binary computer code. This in turn allows machines and computers to function. The semiconductor industry is a complex and capital-intensive industry with a truly globalised supply chain. It is made up of very large companies that monopolise or oligopolise certain specialised areas. These specialties include foundries, which are companies like Samsung and TSMC that make the microchips. Chip designers, (or “fabless”) like Nvidia and AMD, which create the microchip architecture. And equipment makers, like Lam Research and ASML, that produce the machines that build microchips.
How are the companies in the index identified?
Companies from developed markets, Korea and Taiwan are taken from the FactSet classification system, known as Revere Business Industry Classification System (RBICS). Companies in the semiconductor RBICS industry and its semiconductor equipment and services and semiconductor manufacturing subsectors are eligible for inclusion. To qualify for the index, companies must have a market capitalisation of US$1 billion and a minimum average daily trading value of US$1 million over 3 months (these requirements are lowered for existing constituents at rebalance.) The top 30 companies by market capitalisation are picked, with the weights of each stock capped at 10%.
How are companies in SEMI weighted?
SEMI uses a capped index methodology, where the largest companies are restricted to taking no more than 10% of the portfolio. At each quarterly rebalance, the biggest companies in the index are sold back down to 10% if their weights have ballooned beyond the set 10% parameter. This weighting methodology is used to prevent the biggest companies – as of July 2021, these are TSMC and Nvidia – from becoming too influential in determining the performance of the fund.
Why use SEMI for exposure to semiconductors?
The semiconductor supply chain is truly global, ranging from the US to Europe and Asia. By using SEMI, investors can access this global supply chain in a single trade. This spares them the work and cost of buying a portfolio of global semiconductor stocks individually. It also provides instant diversification and potentially lower risk than buying individual stocks. As SEMI trades on the ASX and is locally domiciled, there is also less paperwork for end investors. Investors will not be required to complete W8BEN forms.
How can you use SEMI in a portfolio?
To express long-term strategic or short-term tactical views on the growing demand for microchips. To complement technology sector exposure with tech-aligned companies outside of the GICS classification (the industry sector classification created by MSCI and S&P Dow Jones Indices). To aid portfolio diversification via investment in industries that are largely absent from the Australian market.
Does SEMI overlap with other Global X funds?
We design our ETFs with a view of minimising the amount of overlap between each. In this way, investors who buy more than one of our funds avoid buying the same stocks repeatedly. The precise amount of overlap between each fund can differ as the stocks moving in and out of each ETF change at index rebalance/reconstitution. Whatever overlap exists is usually small. For investors wanting to know the exact quantify of overlap between specific ETFs, please feel free to contact us.
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