VanEck’s UCITS semiconductor ETF hits $500m in assets in six months

Jun 16th, 2021 | By | Category: Equities

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Europe’s first and only pure-play semiconductor ETF has amassed $500m in assets in a little over six months.

VanEck’s UCITS semiconductor ETF hits $500m in assets in six months

VanEck’s UCITS semiconductor ETF has raced to $500m in assets. (File Image)

Launched by VanEck in December 2020, the VanEck Vectors Semiconductor UCITS ETF has passed the half-billion-dollar milestone chiefly thanks to bumper investor inflows.

The fund pulled in between $51m and $117m in new money in each of the first five months of this year, and it reached the $100m mark after 10 weeks.

Market performance has also contributed to asset growth with the strategy up 17.3% year to date.

The fund is listed on London Stock Exchange in US dollars (SMH LN) and pound sterling (SMGB LN), on SIX Swiss Exchange in Swiss francs (SMHV SW), and on Xetra (VVSM GY) and Borsa Italiana (SMH IM) in euros.

The fund was launched on the back of the hugely popular and highly liquid VanEck Vectors Semiconductor ETF (SMH US), its US-domiciled counterpart. This Nasdaq-listed fund houses $5.5 billion in assets and is linked to the MVIS US Listed Semiconductor 25 Index.

The European fund tracks a slightly modified version of this reference – namely the MVIS US Listed Semiconductor 10% Capped Index – to ensure compliance with UCITS rules.

The index selects US-listed stocks with market capitalizations above $150 million that derive at least 50% of their revenue from the production of semiconductors and semiconductor equipment. Constituents are weighted by market capitalization subject to a cap of 10%. It is rebalanced on a semi-annual basis.

Notable positions include names such as Nvidia, ASML, Taiwan Semiconductor, Intel, Texas Instruments, Qualcomm, Broadcom, and AMD.

According to VanEck, the strategy provides indirect exposure to a broad range of technology-related themes as microchips are an essential component of many next-generation innovations such as cloud computing, artificial intelligence, robotics, cybersecurity, and autonomous driving.

Commenting on the AUM milestone, Martijn Rozemuller, head of Europe at VanEck, said: “In the six months since its launch, our ETF has grown significantly, reflecting the high demand from investors for investment opportunities in the semiconductor sector.

“The extensive coverage of semiconductors in recent months has shown how important this technology is to our entire economy. Robotics, cloud computing, autonomous driving or artificial intelligence have a growing demand for powerful microchips, which, in a way, are the nervous system of our technology today.”

The fund has a total expense ratio of 0.35%.

VanEck’s UCITS semiconductor ETF hits $500m in assets in six months

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