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Is Buying This Semiconductor ETF the Best Way to Invest in Artificial Intelligence (AI) Stocks?
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If you've been investing or simply tracking artificial intelligence (AI) stocks, you know that there are plenty of them to choose from. Rather than picking individual ones, what you may want to consider is investing in an exchange-traded fund (ETF) that gives you broad exposure to AI stocks as a whole. The iShares Semiconductor ETF (NASDAQ: SOXX) focuses on semiconductor companies, which have generated significant growth in recent years due to AI and an increase in tech spending as a whole. This year, the ETF has risen by more than 45%. And over the past five years, it has tripled in value. Could this ETF be the way to invest in AI right now, to ensure you have good exposure to many stocks while keeping your risk relatively low? Will AI create the world's first trillionaire? Our team just released a report on a little-known company, called an "Indispensable Monopoly," providing the critical technology Nvidia and Intel both need. Continue » Rather than trying to pick winners in AI, by investing in the iShares Semiconductor ETF, you can get exposure to the big names through just a single investment. That's because this ETF's portfolio features many top AI stocks, including Broadcom, Advanced Micro Devices, and Nvidia -- those stocks are among its largest holdings. There are 30 stocks in its portfolio, suggesting that while it isn't overly diverse, it can still be an effective way to reduce your overall risk. Broadcom is the fund's largest holding, accounting for roughly 8% of the portfolio. That's a decent amount of exposure that offers a good mix. Any more, and you might worry the stock could drag your returns down if it performs poorly, and a far lower rate would mean you might not benefit much from its gains. The ETF's positions in Nvidia and AMD are similar in size, with each holding making up more than 7% of the portfolio. At 0.34%, the fund's expense ratio isn't all that high, and in return, you get an excellent mix of top AI stocks. If you want to benefit from the growth opportunities from the big players in AI, then it's hard to go wrong with the iShares Semiconductor ETF. It has a good mix of the top stocks that can put you in an excellent position to generate strong returns over the long haul. It's been a good investment in recent years, and if AI spending remains high, that trend can continue in the future. While this is by no means a risk-free investment, it can be a fairly balanced option to consider, and it's an easier alternative than buying AI stocks individually. Before you buy stock in iShares Trust - iShares Semiconductor ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and iShares Trust - iShares Semiconductor ETF wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $492,752!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,327,935!* Now, it’s worth noting Stock Advisor’s total average return is 991% — a market-crushing outperformance compared to 201% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of April 28, 2026. David Jagielski, CPA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Broadcom, Nvidia, and iShares Trust-iShares Semiconductor ETF. The Motley Fool has a disclosure policy. Is Buying This Semiconductor ETF the Best Way to Invest in Artificial Intelligence (AI) Stocks? was originally published by The Motley Fool
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