Jasmine Birtles
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5 Best Semiconductor ETFS to Watch in 2026
Ruby Layram
21st Jul 2026
If you’ve been reading about artificial intelligence, data centres or electric vehicles, you’ve probably come across the same word again and again: semiconductors. These tiny chips power almost everything in modern life, from smartphones to supercomputers, and the companies that make them have been some of the strongest performers on the stock market in recent years.
Buying shares in a single chip company can feel like a gamble- picking winners in a fast-moving, highly technical industry isn’t easy, even for professionals. That’s where semiconductor ETFs come in.
An ETF lets you invest in a whole basket of semiconductor companies in one go, spreading your risk across the sector rather than betting on just one name.
In this guide, we’ll walk through the best semiconductor ETFs available to UK investors, what they actually hold, what they cost, and the risks worth knowing about before you invest.
What Is a Semiconductor ETF?
A semiconductor ETF is a fund that pools money from lots of investors and uses it to buy shares in companies involved in designing, manufacturing or supplying equipment for computer chips. Rather than trying to guess which individual chip company will do best, you get exposure to the sector as a whole, in a single, tradeable fund that sits neatly inside an ISA or SIPP.
For UK investors, it’s worth knowing that the ETFs we’ll cover below are all UCITS-compliant– a European regulatory standard that most UK platforms require in order to list a fund for retail investors. This is an important detail, because many well-known US-listed semiconductor ETFs simply aren’t available to buy through UK investment platforms for this reason.
The Best Semiconductor ETFs for UK Investors
1. VanEck Semiconductor UCITS ETF (SMH)
This is one of the most established and widely held semiconductor ETFs available to UK investors, and it’s consistently one of the most popular sector ETFs on major UK investing platforms.
The fund tracks the MVIS US Listed Semiconductor 25 Index, which means it concentrates on the 25 largest and most liquid semiconductor companies listed in the US, including chip designers, manufacturers and the equipment makers that supply them.
Because it’s a concentrated, market-cap weighted fund, its performance tends to be heavily influenced by its largest holdings.
2. iShares MSCI Global Semiconductors UCITS ETF (SEMI)
If SMH is the concentrated option, iShares’ SEMI is the more diversified alternative.
It tracks the MSCI ACWI IMI Semiconductors & Semiconductor Equipment ESG Screened Capped Index, giving exposure to around 260 companies across both developed and emerging markets, including the US, Taiwan and Japan, three of the most important countries in the global chip supply chain.
The “ESG Screened” element means the index excludes companies involved in a small number of controversial areas (such as certain weapons manufacturing and thermal coal), which is worth knowing if that matters to your investing approach, and worth knowing if it doesn’t, since it does mean the fund isn’t a pure, unscreened play on the sector.
3. Amundi MSCI Semiconductors UCITS ETF
Amundi’s semiconductor ETF is a strong middle-ground option and one of the largest funds tracking this specific index.
It follows the MSCI ACWI Semiconductors & Semiconductor Equipment Filtered Index, giving diversified global exposure similar in spirit to the iShares fund above, but from a different provider- useful to know if you’d rather not have all your sector exposure concentrated with a single fund house.
It’s available in both accumulating and distributing share classes, so if you’d specifically like your semiconductor holding to pay out dividends rather than reinvest them automatically, this is one of the few funds on this list that offers that choice.
4. Invesco EQQQ NASDAQ-100 UCITS ETF (EQQQ)
If the idea of a fund that’s almost entirely exposed to one sector makes you a little uneasy, which is a completely reasonable instinct for a beginner, it’s worth knowing that semiconductor exposure doesn’t have to mean an all-or-nothing sector fund.
EQQQ is one of the UK’s most established and heavily traded ETFs, tracking the Nasdaq-100. Its largest sector weighting, Electronic Technology, sits at around a third of the fund and includes many of the same major chip and hardware names found in the dedicated semiconductor funds above, alongside a wider spread of software, retail and healthcare businesses.
This won’t give you the same concentrated upside if chip stocks specifically outperform the broader market, but it spreads your risk further, which can be a sensible way to gain some exposure to the theme without committing to a single-sector fund as your first move.
5. iShares AI Infrastructure UCITS ETF (AINF)
A newer, more thematic option worth knowing about. Rather than targeting “semiconductors” as a labelled sector, this fund tracks the STOXX Global AI Infrastructure Index, which is built around companies expected to play a central role in AI infrastructure, a category that includes semiconductor makers alongside cloud computing and data infrastructure businesses.
In practice, several of its largest holdings are the same chip giants featured in the dedicated semiconductor funds above.
Because it’s a newer, smaller and more thematically defined fund, it’s worth treating as more experimental than the larger, more established options on this list.
How Do These Funds Compare?
| Fund | Ticker | TER | Approx. Holdings | Style |
|---|---|---|---|---|
| VanEck Semiconductor UCITS ETF | SMH / SMGB | 0.35% | 25 | Concentrated, US-focused |
| iShares MSCI Global Semiconductors UCITS ETF | SEMI | 0.35% | ~260 | Diversified, global, ESG-screened |
| Amundi MSCI Semiconductors UCITS ETF | LSMC / SEMG | 0.35% | ~200+ | Diversified, global, alternative provider |
| Invesco EQQQ NASDAQ-100 UCITS ETF | EQQQ | 0.30% | 100 | Broad tech, indirect chip exposure |
| iShares AI Infrastructure UCITS ETF | AINF | 0.35% | ~50-70 | Thematic, semiconductor + AI infrastructure |
Figures correct as of July 2026 and subject to change- always check the fund provider’s factsheet for the latest data before investing.
Risks of Investing in Semiconductor ETFs
Before you consider any sector-specific fund, it’s worth being honest about the risks involved, because they’re different, and generally higher, than a broad, diversified world index fund.
- Concentration risk. These are sector funds, not diversified portfolios. If the semiconductor industry has a bad year, these ETFs will feel it far more sharply than a fund spread across dozens of industries.
- Geopolitical risk. A huge proportion of global chip manufacturing is concentrated in a small number of countries and companies, particularly in Taiwan. Political tensions, trade restrictions or export controls affecting this region can move these funds significantly, in either direction.
- Cyclicality. The semiconductor industry has historically moved through boom-and-bust cycles tied to demand for electronics, AI infrastructure and consumer spending. Strong growth in one period doesn’t guarantee the same in the next.
- Valuation risk. Because the sector has performed strongly in recent years, some semiconductor companies now trade on high valuations relative to their earnings, which can mean more downside if sentiment shifts.
For all these reasons, semiconductor ETFs are generally better suited to sitting alongside a diversified core portfolio, rather than being your only investment.
How to Buy a Semiconductor ETF in the UK
Once you’ve decided which fund suits you, buying one is straightforward:
- Open an account with a UK investment platform or stockbroker that offers ISAs or SIPPs.
- Search for the fund using its ticker or ISIN (both listed above).
- Decide how much to invest, keeping in mind the concentration risks above — many beginners choose to keep sector-specific funds to a smaller percentage of their overall portfolio.
- Place your order and consider whether a lump sum or regular monthly investing suits your circumstances better.
Frequently Asked Questions
Are semiconductor ETFs a good investment for beginners? They can play a role in a beginner’s portfolio, but they’re generally better suited as a smaller, supporting position alongside a diversified core fund, rather than a first or only investment, given the concentration and cyclicality risks involved.
What’s the difference between SMH and SEMI? SMH (VanEck) is a concentrated fund of the 25 largest US-listed semiconductor companies, while SEMI (iShares) is a more diversified, globally spread fund of around 260 companies with an ESG screen applied.
Which semiconductor ETF is best for beginners? There’s no single “best” fund — it depends on how much concentration risk you’re comfortable with. Beginners who want the purest, most direct exposure often start with a diversified option like SEMI or the Amundi fund, while those who’d rather ease in more gradually may prefer a broader fund like EQQQ that includes chip exposure without being solely dependent on the sector.
Can I hold a semiconductor ETF in a Stocks & Shares ISA? Yes. Both funds covered in this guide are UCITS-compliant and available through UK platforms that offer Stocks & Shares ISAs and SIPPs.
Do semiconductor ETFs pay dividends? This varies by share class. Many, including the accumulating share classes covered above, automatically reinvest any income rather than paying it out, which can be useful for long-term, tax-efficient growth inside an ISA.
This article is for general information purposes only and does not constitute financial advice. The value of investments can fall as well as rise, and you may get back less than you invest. Always do your own research, and consider speaking to a regulated financial adviser before making investment decisions.
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