Taiwan Semi Outperforms China's Top Chipmaker Amid Tech Challenges
Portfolio Pulse from Anusuya Lahiri
Taiwan Semiconductor Manufacturing Co (TSMC) has outperformed China's Semiconductor Manufacturing International Corp (SMIC) this year, highlighting China's challenges in advancing its domestic chip industry. Despite China's investment in semiconductor technology, TSMC's advanced capabilities and U.S. export controls have given it a significant edge. TSMC's sales grew by 30% in May, driven by AI demand, and its stock has gained over 57% in the last 12 months. Investors can gain exposure to the semiconductor sector via ETFs like FTXL and SSG.
June 11, 2024 | 11:20 am
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POSITIVE IMPACT
The First Trust Nasdaq Semiconductor ETF (FTXL) provides exposure to the semiconductor sector, which is experiencing strong growth driven by companies like TSMC and Nvidia.
FTXL offers investors exposure to the semiconductor sector, which is experiencing strong growth driven by companies like TSMC and Nvidia. The ETF is likely to benefit from the positive performance of these key players.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 30
POSITIVE IMPACT
Nvidia, a key supplier for TSMC, is expected to benefit from the AI-driven sector recovery in 2024. TSMC's strong performance and AI demand indirectly support Nvidia's growth prospects.
As a key supplier for TSMC, Nvidia stands to benefit from the AI-driven sector recovery expected in 2024. TSMC's strong performance and AI demand indirectly support Nvidia's growth prospects.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 50
POSITIVE IMPACT
TSMC has significantly outperformed SMIC, driven by its advanced chip manufacturing capabilities and strong AI demand. TSMC's May sales grew by 30%, and its stock has gained over 57% in the last 12 months.
TSMC's advanced chip manufacturing capabilities and strong AI demand have driven significant sales growth and stock performance. The company's ability to produce 3nm chips gives it a competitive edge over SMIC.
CONFIDENCE 95
IMPORTANCE 90
RELEVANCE 100
NEGATIVE IMPACT
ProShares UltraShort Semiconductors (SSG) provides inverse exposure to the semiconductor sector. Given the strong performance of companies like TSMC, SSG may face downward pressure.
SSG offers inverse exposure to the semiconductor sector. Given the strong performance of companies like TSMC, the ETF may face downward pressure as the sector continues to grow.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 30