Semiconductor Industry ETF

AAA

DEFINITION of 'Semiconductor Industry ETF'

A sector-following fund that invests in developers, manufacturers and marketers of digital and analog chips, so as to obtain investment results that closely match those of an underlying semiconductor index. There are a number of semiconductor ETFs trading on U.S. exchanges that are based on various chip indexes.

INVESTOPEDIA EXPLAINS 'Semiconductor Industry ETF'

The semiconductor industry is widely regarded as a leading indicator of U.S. economic activity. As a result, semiconductor indexes and the ETFs based on them tend to precede advances and declines in broad equity indexes.


By owning an ETF you get the diversification of an index fund as well as the ability to sell short, buy on margin and purchase as little as one share. Another advantage is that the expense ratios for most ETFs are lower than those of the average mutual fund. When buying and selling ETFs you have to pay the same commission to your broker that you'd pay on any regular order.

RELATED TERMS
  1. Book-To-Bill Ratio

    The ratio of orders received to units shipped and billed for ...
  2. Semiconductor

    A materials product - usually comprised of silicon - which conducts ...
  3. Silicon Valley

    A part of the San Francisco Bay Area that is known for the many ...
  4. Philadelphia Semiconductor Index ...

    A price-weighted index composed of 18 U.S. semiconductor companies ...
  5. Exchange-Traded Fund - ETF

    A security that tracks an index, a commodity or a basket of assets ...
  6. Factor Investing

    An investment strategy in which securities are chosen based on ...
Related Articles
  1. Spread Out Risk With Sector-Based ETFs ...
    Mutual Funds & ETFs

    Spread Out Risk With Sector-Based ETFs ...

  2. Building An All-ETF Portfolio
    Mutual Funds & ETFs

    Building An All-ETF Portfolio

  3. An Introduction To Sector ETFs
    Mutual Funds & ETFs

    An Introduction To Sector ETFs

  4. A Guide To Key ETFs Investing In South ...
    Mutual Funds & ETFs

    A Guide To Key ETFs Investing In South ...

comments powered by Disqus
Hot Definitions
  1. Effective Annual Interest Rate

    An investment's annual rate of interest when compounding occurs more often than once a year. Calculated as the following: ...
  2. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  3. Odious Debt

    Money borrowed by one country from another country and then misappropriated by national rulers. A nation's debt becomes odious ...
  4. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
  5. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
  6. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
Trading Center