Key Points
-
Semiconductor ETFs captured five of the top six spots with returns ranging from 18.94% to 47.67%.
-
The best performer returned 47.67% over five years.
-
Broad tech ETFs underperformed specialized semiconductor funds despite both outpacing the S&P 500’s 11.68% return.
The analyst who called NVIDIA in 2010 just named his top 10 AI stocks. Get them here FREE.
Growth exchange-traded funds have been among the best-performing assets over the past two decades. These ETFs usually comprise technology stocks, almost all of which have been growing at breakneck speeds. Tech has turned into the driving factor of the economy, and this trend only seems to be accelerating due to AI.
No one can say for sure what the next 10 years hold, but if you use the last five years as a yardstick, one can assume that even more of Wall Street will start coalescing into AI or tech-related names. Who knows? Perhaps even quantum computing tech will become a thing, and it may supercharge current trends even more.
Here’s a look at the top 10 growth ETFs for the last five years.
#10 iShares U.S. Technology ETF (IYW)
This fund from BlackRock seeks to track the investment results of an index composed of U.S. equities in the technology sector, targeting domestic tech leaders. The underlying benchmark is the Russell 1000 Technology RIC 22.5/45 Capped Index. Recent top holdings include Nvidia, Microsoft, Apple, Meta Platforms, Broadcom, Oracle, Alphabet (A and C shares), Palantir, and IBM.
IYW has a five-year return of 15.93%. For comparison, the S&P 500 had an annualized five-year return of 11.68%. Shares cost $190.54, as of Feb. 14. The fund holds $20.76 billion in assets and has an expense ratio of 0.38%.
#9 State Street Technology Select Sector SPDR ETF (XLK)
Managed by State Street Global Advisors, this SPDR ETF seeks to provide investment results that correspond to the price and yield performance of the Technology Select Sector Index of S&P 500 companies. It offers broad, cap-weighted exposure to U.S. large-cap information technology leaders within the S&P 500. Positions include Nvidia, Microsoft, Apple, Broadcom, Oracle, Palantir, Cisco, IBM, Salesforce, and AMD.
XLK ($139.56 per share) returned 15.98% in the last five years. The fund has net assets of $91.64 billion and a low expense ratio of 0.08%.
#8 Invesco S&P 500 Momentum ETF (SPMO)
This fund tracks the performance of stocks in the S&P 500 Index that have a high “momentum score”. Its current largest holdings are Broadcom Inc., Nvidia, and Meta.
SPMO ($118.25 per share) returned 17.69% in the last five years. The fund has net assets of $13.7 billion and an expense ratio of 0.13%.
#7 Direxion Daily Technology Bull 3X Shares (TECL)
This ETF seeks daily investment results of 300% of the performance of the Industrials Select Sector Index. Among its top holdings are GE Aerospace, Caterpillar, Raytheon Technologies, Boeing, and Uber.
The fund is priced at $103.57. TECL returned 18.54% in the five-year period. Net assets are $3.88 billion and the expense ratio is 0.85%.
#6 First Trust Nasdaq Semiconductor ETF (FTXL)
Another strong tech play, FTXL seeks to match the performance of the Nasdaq US Smart Semiconductor Index. Current top holdings include Micron Technology, Intel Corp., Lam Research Corp., Applied Materials, and Broadcom.
Priced at $156.34, the First Trust fund has a 18.94% five-year return. Its expense ratio is 0.6%. The ETF has $1.58 billion in assets.
#5 Invesco Semiconductors ETF (PSI)
This one tracks the Dynamic Semiconductor Intellidex Index, a smart-beta benchmark that selects and weights U.S. semiconductor companies. Positions include Micron, Lam Research, KLA Corp, Broadcom, Qualcomm, Nvidia, AMD, and Analog Devices.
PSI ($100.58 per share) returned 19.63% in the latest five-year period. The ETF has net assets of $1.19 billion and an expense ratio of 0.56%.
#4 iShares U.S. Aerospace & Defense ETF (ITA)
This fund provides exposure to U.S. companies that manufacture commercial and military aircrafts and other defense equipment. Holdings include familiar names like Boeing, Lockheed Martin Corp., and Northrop Grumman Corp.
ITA ($234.87) offered a five-year return of 19.86%. Its net assets total $14.81B billion. The expense ratio is 0.38%.
#3 iShares Semiconductor ETF (SOXX)
This one tracks the NYSE Semiconductor Index. You get concentrated exposure to chip-makers. Recent top names include Broadcom, Nvidia, AMD, Micron, Qualcomm, Lam Research, Intel, Marvell, Applied Materials, and Texas Instruments.
SOXX shares cost $354.66. It returned 20.52% in five years, with net assets of $20.97 billion and an expense ratio of 0.34%.
#2 VanEck Semiconductor ETF (SMH)
This fund seeks to replicate the MVIS US Listed Semiconductor 25 Index, which tracks companies involved in semiconductor production and equipment. It has global scope via U.S.-listed domestic and foreign chip leaders. Recent top holdings include Nvidia, Taiwan Semiconductor Manufacturing, Broadcom, ASML, AMD, and Intel.
VanEck Semiconductor is priced at $407.72 per share and has an expense ratio of 0.35%. The fund has net assets of $44.07 billion and returned an impressive 27.06% in five years.
#1 ProShares Ultra Semiconductors (USD)
Our top performing ETF aims to double the daily performance of the Dow Jones U.S. Semiconductors Index. It holds many of the familiar semiconductor names (Nvidia, Broadcom, etc.)
The fund has a remarkable five-year return of 47.67%. It has net assets of $1.85 billion and an expense ratio of 0.95%. Shares are priced at $55.27.
The image featured at the top of this post is ©DANIEL CONSTANTE.