Photo by Mohamed Nohassi on Unsplash

There are 6 sub-segments in the AI hardware (semiconductor/computer chip/wafer) segment and we track the largest stocks in each sub-segment  in 6 similarly focused model portfolios The constituents in the 6 model portfolios number 26 which are identified below along with a chart of the sum total of their performances.

1. The Pure-Play EDA Software Chip Design Model Portfolio: up 10.6% YTD

• Focus: design of complex semiconductor chips using sophisticated electronic design automation (EDA) software.
• Constituents: Cadence Design Systems (CDNS); and Synopsys (SNPS).

2. The Pure-Play Semiconductor Supplier Model Portfolio: up 47.2% YTD

• Focus: provide essential equipment for manufacturing chips such as lithography machines, etching, test and packaging equipment, automation and inspection systems and production materials such as chemicals, gases, wafers and packaging.
• Constituents: Applied Materials (AMAT); ASML Holding (ASML); KLAC Corp. (KLAC); and Lam Research (LRCX).

3. The Pure-Play Semiconductor Foundries Model Portfolio: up 24.6% YTD

• Focus: factories (called foundries in semiconductor jargon) concentrate all their efforts in the manufacture of chips based on the designs provided by other semiconductor companies.
• Constituents: GlobalFoundries (GFS); Taiwan Semiconductor (TSM); Tower Semiconductor (TSEM); and United Microelectronics   (UMC).

4. The Pure-Play Outsourced Semiconductor Assembly and Test (OSAT) Model Portfolio: up 11.2% YTD

• Focus: assemble chips into finished semiconductor components, tests for defects and do the very specialized packaging of the chips for shipping.
• Constituents: Amkor Technology (AMKR) and ASE Technology (ASX).

5. The Pure-Play Fabless Semiconductor Companies Model Portfolio: up 8.6% YTD

• Focus: manufacturers design and sell hardware devices and semiconductor chips themselves while outsourcing their fabrication (i.e. are fabless) to a specialized manufacturer.
• Constituents: Advanced Micro Devices (AMD);  Broadcom (AVGO); Marvell (MRVL); Monolithic Power (MPWR);   Nvidia  (NVDA);  and Qualcomm (QCOM).

6. The Integrated Device Manufacturer (IDM) Model Portfolio: up 17.7% YTD

• Focus: companies do everything themselves in house to control the entire production process.
• Constituents: Analog Devices (ADI); Infineon Technologies (IFNNY); Intel Corp. (INTC);  Microchip Technology (MCHP); Micron Technology (MU); NXP Semiconductors (NXPI);  STMicroelectronics (STM); and Texas Instruments (TXN).

Summary

The above 6 sub-segments in the AI Semiconductor Model Portfolio are up 28.95%, on average, YTD and, as shown in the portfolio performance chart below, has outpaced the Nasdaq (QQQ benchmark) which has "only" gone up 17.75% YTD.

A Chart of the Performance of the Portfolio Of 26 Constituents

• The Invesco QQQ Trust Series I (QQQ) benchmark is an exchange-traded fund that is based on the Nasdaq 100 index, a modified-market-cap-weighted index of 100 Nasdaq-listed stocks.

The portfolio chart has been generated using the tools provided by PortfoliosLab.com and easy step-by-step instructions are available here to help you create a chart of your own portfolio or that of a client. It's easy, fast and free.

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