One should be careful when selecting semiconductor stocks to invest in. Some considerations below:
In times of market distress, smaller stocks could become more difficult to sell at market prices. Generally, liquidity risk could be reduced by investing in the larger semiconductor stocks.
An investor might be tempted to only buy them based in the country where he or she lives. However, diversifying globally actually could reduce this risk.
The VanEck Semiconductor UCITS ETF offers a relatively low-cost, diversified way to get exposure to semiconductor stocks. It invests in 25 of them from across the globe, listed in the USA.
Lower risk: Typically lower reward
Higher risk: Typically higher reward
The prices of the securities included in the Fund can be impacted by the risks in relation to investment in the securities market, such as certain economic circumstances and an unforeseen decrease in value. An investment in the Fund may cause financial loss.
The equities, which the index comprises, may be traded in a different currency than that used by the investor. As a result, currency losses may have a negative impact on the return to the investor from the investment.
The Fund will be sensitive to the overall condition of semiconductor companies. These companies, among other factors, are heavily dependent on the protection of patent and intellectual property rights.
For more information on risks, please see the “Risk Factors” section of the relevant Fund’s prospectus, available on www.vaneck.com.