Intelligence Feed event · Equity · 2026-08-26

    SOXX ETF Outperforms SMH by 16.5% YTD on Lower Concentration Risk

    Question

    SOXX ETF Outperforms SMH by 16.5% YTD on Lower Concentration Risk

    Direct answer

    A significant performance gap has opened between the two leading semiconductor ETFs. The iShares Semiconductor ETF (SOXX) has outperformed the VanEck Semiconductor ETF (SMH) by over 16% this year. The primary driver is concentration: SMH is heavily weighted toward Nvidia and TSMC, making it vulnerable to pullbacks in those specific names. In contrast, SOXX's methodology caps any single holding at 9%, providing more balanced exposure to the broader industry, including equipment makers and analog chip firms. This diversification has proven superior as the 'AI trade' becomes more fragmented across the supply chain.

    Original publisher
    Market Ontology
    Evidence through
    2026-08-26
    Published
    2026-10-20
    Revision
    1 · 2026-10-20

    Cite as: Market Ontology, “SOXX ETF Outperforms SMH by 16.5% YTD on Lower Concentration Risk”, revision 1, evidence through 2026-08-26. https://marketontology.com/market-events/2026-08-26/soxx-etf-outperforms-smh-by-16-5-ytd-on-lower-concentration-risk-a493d6

    EQUITY
    SOXX ETF Outperforms SMH by 16.5% YTD on Lower Concentration Risk
    A significant performance gap has opened between the two leading semiconductor ETFs. The iShares Semiconductor ETF (SOXX) has outperformed the VanEck Semiconductor ETF (SMH) by over 16% this year. The primary driver is concentration: SMH is heavily weighted toward Nvidia and TSMC, making it vulnerable to pullbacks in those specific names. In contrast, SOXX's methodology caps any single holding at 9%, providing more balanced exposure to the broader industry, including equipment makers and analog chip firms. This diversification has proven superior as the 'AI trade' becomes more fragmented across the supply chain.
    SOXXSMH
    Impact
    62
    AUG 26
    SIG
    90%
    SOXXSMH
    SOXX ETF Outperforms SMH by 16.5% YTD on Lower Concentration Risk
    A significant performance gap has opened between the two leading semiconductor ETFs. The iShares Semiconductor ETF (SOXX) has outperformed the VanEck Semiconductor ETF (SMH) by over 16% this year. The primary driver is concentration: SMH is heavily weighted toward Nvidia and TSMC, making it vulnerable to pullbacks in those specific names. In contrast, SOXX's methodology caps any single holding at 9%, providing more balanced exposure to the broader industry, including equipment makers and analog chip firms. This diversification has proven superior as the 'AI trade' becomes more fragmented across the supply chain.
    → Index methodology driving performance dispersion in sector ETFs.
    Impact
    A significant performance gap has opened between the two leading semiconductor ETFs. The iShares Semiconductor ETF (SOXX) has outperformed the VanEck Semiconductor ETF (SMH) by over 16% this year. The primary driver is concentration: SMH is heavily weighted toward Nvidia and TSMC, making it vulnerable to pullbacks in those specific names. In contrast, SOXX's methodology caps any single holding at 9%, providing more balanced exposure to the broader industry, including equipment makers and analog chip firms. This diversification has proven superior as the 'AI trade' becomes more fragmented across the supply chain.
    Affected
    SOXXSMH
    Transmission
    Index methodology driving performance dispersion in sector ETFs.

    How this development reaches the affected companies

    AssetExposure and channelDirectionEvidence
    SOXXdiversification-driven alphaUp1-4wOutperforming SMH by 16.54% YTD.
    SMHconcentration-driven volatilityDown1-4w30% weight in top two holdings.

    Does this development affect your holdings?

    Enter your holdings to check them against this and other recent developments, review the decision that matters most, then set a monitor.

    Check this development against my holdings

    Review your initial audit before choosing ongoing portfolio scanning at $79/month.

    What happened next

    AssetCallBase close+1 day+5 days+20 days
    SMHDowndisagreed555.77 2026-08-26+3.10%-0.95%+8.05%
    SOXXUpagreed515.40 2026-08-26+1.95%-2.71%+9.83%

    Closing prices from stored daily bars; returns measured from the last close on or before the event date. Not a recommendation.

    No verifiable public source recorded for this card.

    Related

    Check this development against my holdings

    See today's live cards

    Public pages are published 24 hours after the product shows them. Desk shows every catalyst, event and causal reading as it happens, mapped to your holdings.

    Open Desk — $399/month