Semiconductor ETF Tops In April: 5 Stocks Leading The Rally

The semiconductor corner of the technology sector, no doubt, led the broad market rally and is the clear winner in April. iShares PHLX Semiconductor ETF (SOXX - Free Report) topped the list of the best performing ETFs, with impressive returns of more than 8%.

The rally was mainly driven by strong optimism over the deal between the two largest countries to end a year-long trade war that badly shook the industry last year. This is because chipmakers have a significant exposure in China. Rising demand for cutting-edge technology, including cloud computing, big data, Internet of Things, wearables, gaming, autonomous cars, VR headsets, drones, virtual reality, artificial intelligence and machine is also fueling growth.

Additionally, the deployment of 5G (fifth-generation) technology — the next wireless revolution — is creating further opportunities. The wave of mergers and acquisitions provides further impetus to the space.

Chipmakers power much of the world’s technology with their new innovation and set the stage for digitalization in various corners like healthcare, transport, financial systems, defense, agriculture, retail and many others.

Let’s take a closer look at the fundamentals of SOXX.

SOXX in Focus

This ETF offers exposure to U.S. companies that design, manufacture, and distribute semiconductors by tracking the PHLX SOX Semiconductor Sector Index. It holds 30 stocks in its basket with higher concentration on the top firms. The fund has AUM of $1.3 billion and trades in a solid volume of around 734,000 shares. It charges 47 basis points in annual fee and has a Zacks ETF Rank #3 with a High risk outlook.

Though most of the stocks in the fund’s portfolio delivered strong returns, a few have gained in double digits. Below we have highlighted those five best-performing stocks in the ETF of April with their respective positions in the fund’s basket:

Best Performing Stocks of SOXX

Qualcomm Incorporated (QCOMFree Report): This company is a world leader in 3G, 4G and next-generation wireless technologies. It gained about 53% in April. Qualcomm currently has a Zacks Rank #3 (Hold) and a VGM Score of F. The stock occupies the top position in the fund’s portfolio, making up for 11.3% share.

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