Semiconductor ETFs delivered the strongest returns of any equity theme in the first half of 2026, and they also carry the most concentration risk. The iShares Semiconductor ETF (SOXX) closed at $566.32 on July 2, 2026, up 88.1% from its December 31, 2025 close of $301.15, and the VanEck Semiconductor ETF (SMH) closed at $592.29, up 64.5% over the same period [4]. Both funds hold 25 to 30 stocks, the top ten positions in SOXX made up 61.29% of the portfolio as of June 30, 2026, and SOXX traded at a price to earnings ratio of 76.39 times trailing earnings on that date [1]. The rally has been powerful, but the two ETFs are narrow, expensive on earnings, and volatile, as the 11.6% drop in SOXX over the first two trading days of July shows [4].
How semiconductor ETFs performed in the first half of 2026
The 2026 path was not a straight line. Both funds fell hard into late March: SOXX bottomed at a $309.79 close on March 30, 2026, and SMH at $362.53 the same day, roughly flat with where they ended 2025 [4]. From that low, SOXX more than doubled to a closing high of $655.01 on June 22, 2026, a gain of 111%, while SMH rose 84.5% to $668.91 [4]. The move then reversed. SOXX ended June at $640.76 and fell to $566.32 by July 2, an 11.6% decline in two sessions on volume of 16.1 million shares, roughly three times a normal day, and the trading range on July 2 alone ran from $554.91 to $608.11 [4]. SMH lost 9.7% over the same two days [4].
The longer record explains why the group attracts so much capital. As of June 30, 2026, SOXX had returned 169.60% over one year at net asset value, 56.92% annualized over three years, 34.50% over five years and 36.59% over ten years [1]. Its calendar year returns show the other side: 40.71% in 2025, 12.97% in 2024, 66.90% in 2023, and a 35.03% loss in 2022 [1]. SMH returned 49.15% in 2025 and 27.73% annualized over the five years through December 31, 2025, according to its summary prospectus [3]. DataPorium's ETF price data lets readers compare these funds against broad indexes day by day.
Concentration: 25 to 30 stocks, and the top ten dominate
Both ETFs are non-diversified funds under the Investment Company Act of 1940, which means they may put a larger share of assets into a single issuer than a diversified fund can [3]. SOXX held 30 stocks as of June 30, 2026, split 75.59% into semiconductor makers and 23.97% into semiconductor equipment companies [1]. The SMH index takes the largest 50 U.S. listed semiconductor stocks by market value and keeps the top 25 by free float market capitalization and three month trading volume [3].
SOXX top ten holdings as of June 30, 2026
| Holding | Weight |
|---|---|
| Micron Technology (MU) | 8.54% |
| Advanced Micro Devices (AMD) | 8.09% |
| Nvidia (NVDA) | 6.81% |
| Intel (INTC) | 6.33% |
| Broadcom (AVGO) | 6.08% |
| Applied Materials (AMAT) | 5.77% |
| KLA (KLAC) | 5.64% |
| Lam Research (LRCX) | 4.89% |
| Marvell Technology (MRVL) | 4.88% |
| Taiwan Semiconductor Manufacturing (TSM) | 4.26% |
| Top ten total | 61.29% |
Source: iShares fact sheet [1]. A notable feature of the 2026 rally is that it was not led by Nvidia. Nvidia (NVDA) closed at $194.83 on July 2, 2026, up only 4.5% from its year end 2025 close of $186.50, while Taiwan Semiconductor (TSM) rose 42.9% to $434.16 over the same period [5]. Memory and equipment names, which sit at the top of the SOXX weighting table, did much of the work. That matters for investors who think of these ETFs as a proxy for one company: they are not, and the leadership inside the basket rotates.
Valuation: what a 76 times earnings multiple implies
SOXX traded at 76.39 times trailing earnings and 13.23 times book value as of June 30, 2026, with a three year equity beta of 2.00 and a three year standard deviation of 35.47% [1]. The fund's 30 day SEC yield was 0.01%, so essentially none of the return comes from income [1]. For context, DataPorium's sector data put the average price to earnings ratio of Nasdaq listed technology companies at 51.47 on December 31, 2025, 53.88 on June 30, 2026 and 49.07 on July 2, 2026, after the technology sector fell 2.94% that day [5]. The semiconductor basket therefore trades at a premium of roughly 50% to the technology sector it belongs to, on earnings that are themselves at a cyclical high.
A high multiple is not a forecast of decline. Earnings for the group grew fast enough in 2025 and early 2026 to justify part of the rerating, and the equipment makers benefit from capital spending on artificial intelligence data centers that is committed years ahead. The fair counterpoint is that semiconductor demand is cyclical, that a 2022 style drawdown of 35% took place inside the same ten year record that shows 36.59% annualized gains, and that a beta of 2.00 means a 10% market pullback has historically mapped to about a 20% move in the fund [1].
Costs and structure: SMH vs SOXX
- Expense ratio. SOXX charged 0.34% as of its June 30, 2026 fact sheet [1]; SMH charges a 0.35% management fee with no other expenses, for a total of 0.35% [3].
- Index. SOXX tracks the NYSE Semiconductor Index [2]; SMH tracks the MVIS US Listed Semiconductor 25 Index [3].
- Size. SOXX held $47.8 billion in net assets as of June 30, 2026, with 30 holdings and quarterly distributions [1].
- Foreign exposure. SMH's prospectus lists foreign securities risk and Taiwan specific risk among its principal risks, because it holds depositary receipts of non U.S. companies such as TSM [3].
Semiconductor ETFs earned their 2026 gains, but 25 to 30 stocks, a 61% top ten weight and a 76 times earnings multiple mean investors are paying a full price for a narrow bet.
Key takeaways
- SOXX rose 88.1% and SMH 64.5% from December 31, 2025 to July 2, 2026, even after an 11.6% two day drop in SOXX at the start of July [4].
- The top ten SOXX holdings were 61.29% of assets as of June 30, 2026, led by Micron, AMD and Nvidia [1].
- SOXX traded at 76.39 times earnings with a beta of 2.00, versus a Nasdaq technology sector average of 49.07 on July 2, 2026 [1][5].
- Expense ratios are similar (0.34% for SOXX, 0.35% for SMH); the main differences are the index rules and the share of foreign listings [1][3].
- Investors may consider position sizes that reflect a fund that has lost 35% in a single calendar year within the past four years [1].
Frequently asked questions
Is SMH or SOXX better in 2026?
Neither is better in a general sense. SOXX gained more in the first half of 2026 (88.1% versus 64.5% through July 2) because its weighting favored memory and equipment stocks, while SMH holds 25 names with a larger weight in foreign listed chipmakers such as TSM [3][4].
How much of SOXX is Nvidia?
Nvidia was 6.81% of SOXX as of June 30, 2026, the third largest position behind Micron (8.54%) and AMD (8.09%) [1].
Are semiconductor ETFs overvalued?
SOXX traded at 76.39 times trailing earnings on June 30, 2026, against 49.07 for the average Nasdaq technology company on July 2, 2026, so the group is priced well above its sector [1][5]. Whether that is overvalued depends on how long earnings keep growing at the current pace.
What is the expense ratio of SMH and SOXX?
SMH charges 0.35% per year and SOXX charged 0.34% as of June 30, 2026 [1][3].
Sources & References
- [1] iShares Semiconductor ETF (SOXX) fact sheet as of June 30, 2026
- [2] iShares Semiconductor ETF (SOXX) fund page
- [3] VanEck Semiconductor ETF (SMH) summary prospectus, SEC EDGAR Form 497K, February 1, 2026
- [4] DataPorium ETF prices (SMH, SOXX daily closes)
- [5] DataPorium stock market data (NVDA, TSM prices and sector P/E)
