Chip replaced software and become investors’ darling

Chip replaced software, please take this note seriously, if you are an U.S. stock investor.

Please check my post “Why software underperforming amid the AI craze?” also.

Semiconductor-related introductory books and articles

My two investment books

Semiconductor investment introductory chapter

My second book has a dedicated subsection:

Sections 3-1 and 3-2 of the book “The Rules of 10 Baggers“, especially the semiconductor investment article in Section 3-2, explain the following topics of global semiconductors to investors in detail: semiconductor investment essentials, semiconductor supply chain, Semiconductor equipment vendors, semiconductor material vendors, and chip designers.

TSMC discussion in my books

I have discussed the company Nvidia (ticker:NVDA) in two recent books; including:

In my book “The Rules of Super Growth Stocks Investing“:

• Sections 2-4, the entire section is dedicated to introducing the company TSMC
• Section 3-3, analyze the business development of technology companies to grasp the pulse of key industries

In my book “The Rules of 10 Baggers“:

• Section 3-2, the entire section is dedicated to introducing TSMC and the global semiconductor supply chain.

The blog you are currently reading

In my blog, there are several articles dedicated to semiconductors:

• “The lucrative semiconductor supply chain“
• “Global semiconductor chip market in detail, big dominators and markets“
• “6 common wrong semiconductor investment myths“
• “Gen 3 semiconductor“

Semiconductors replaced software

The index can speak

Semiconductors have replaced software and have become the mainstream investment in the U.S. technology industry. Data shows that among the 11 major sectors of the S&P 500 Index, semiconductor chip stocks have surpassed software stocks and become the most heavily weighted sector in the index, reflecting the market’s optimism that the semiconductor industry can profit from the field of artificial intelligence., and concerns about the budget pressure on the software industry.

The chip stocks of the S&P 500 Index accounted for 11% of the total market capitalization of the index on May 28, which not only hit a new high, but also increased significantly from 2% at the beginning of 2014.

The Philadelphia Semiconductor Index, which represents semiconductors, has soared 23% this year, and has jumped 48% in the past 12 months, mainly driven by Nvidia’s explosive growth, which has further ignited the market’s investment enthusiasm for other AI-related companies.

According to Dow Jones Market Data, the iShares Technology Software Stock ETF has fallen 4% this year and has risen 19% in the past 12 months, which is far inferior to the S&P 500 Index’s 11% gain this year and 26% gain in the past 12 months.

U.S. stocks rally driven by semiconductors

Last year and so far this year, almost all the gains in U.S. stocks were driven by semiconductors. The gains in semiconductor-related companies contributed to the performance of almost all related indices, ETFs, or stock funds.

For this part, you can refer to the introduction of several articles I have written before:

• “Artificial intelligence benefits industries“
• “Four chip companies account for one-third of S&P 500 gains so far this year
• “Top five lucrative artificial lucrative intelligence listed companies“

Table for US stock investment toolset

Special reminder

For all major market index annualized return query tools listed in the table; including Taiwan Stock Index, Dow Jones Index, S&P 500 Index, Nasdaq Index, Philadelphia Semiconductor Index, not only annualized return query , you can also query the index return rate in any year──just enter the year you want to query in both the start and end fields.

The following is a list of must-have US stock investment free tools developed by Andy Lin:

The online tool I develop	URL for the tool	For detailed function description, please click the description article directly
Andy Lin’s Indices
Andy Lin self-compiled Index, daily updated (including growth stock index, moat index, tracking stock index and other three major indices)	Andy Lin’s Indices	“Andy Indices will be daily updated on the homepage
Annualized rate of return and compound interest
IRR calculator	IRR calculator	“IRR calculator“
Simple and compound interest calculator	Simple and compound interest calculator	“Simple and compound interest calculator“
Famous market index
Taiwan stock exchange	Querier to Annualized rate of return for Taiwan Stock Exchange	“Querier to Annualized rate of return for Taiwan Stock Exchange“
Dow Jones Industrial Average (DJIA) Index	Querier to Annualized rate of return for Dow Jones Industrial Average Index	“Querier to Annualized rate of return for Dow Jones Industrial Average (DJIA) Index“
S&P 500	Querier to Annualized rate of return for S&P 500 Index	“Querier to Annualized rate of return for S&P 500 Index“
Nasdaq	Querier to Annualized rate of return for Nasdaq Index	“Querier to Annualized rate of return for Nasdaq Index“
Philadelphia Semiconductor Index	Querier to Annualized rate of return for Philadelphia Semiconductor Index	“Querier to Annualized rate of return for Philadelphia Semiconductor Index (SOX)“
Important ecnomic data query
US historial GDP querier	US GDP querier	“US Gross domestic product (GDP) querier“
Querier of US Inflation Rate	Querier of US Inflation Rate	“Querier of US Inflation Rate“
Valuation
DCF (Discounted Cash Flow) Calculator	DCF (Discounted Cash Flow) Calculator	“DCF (Discounted Cash Flow) Calculator“
S&P 500 historical PE Ratio and average Querier	S&P 500 historical PE Ratio and average Querier	“S&P 500 P/E ratio has been rising in the past century, S&P 500 PE Ratio and Average Querier“
Data share
Data and sample download	Sample and file download	“Sample and file download“

For the detail, please see “Free online US stock investment toolset＂.

Conclusion

If you are concerned about the performance of your stock investment, I advise you to add semiconductors to your stock investment portfolio before it is too late.

Related articles

• “What are silicon photonics? Why it’s important? and current progress“
• “Semiconductor replaced software and become investors’ darling“
• “Why software underperforming amid the AI craze?“
• “The lucrative semiconductor supply chain“
• “Global semiconductor chip market in detail, big dominators and markets“
• “6 common wrong semiconductor investment myths“
• “Gen 3 semiconductor“
• “How does Applied Materials, lord of semiconductor equipment, make money?“
• “How does Lam Research, top chip equipment player, make money?“
• “Artificial intelligence benefits industries“
• “Four chip companies account for one-third of S&P 500 gains so far this year
• “Top five lucrative artificial lucrative intelligence listed companies“
• “How does nVidia make money, Nvidia is changing the gaming rules“
• “The reasons for Nvidia’s monopoly and the challenges it faces“
• “Why nVidia failed to acquire ARM?“
• “Revisiting Nvidia: The Absolute Leader in Artificial Intelligence, Data Center, and Graphics“
• “Will Intel go bankrupt?“
• “How does Intel make money? and the benefits to invest in it“
• “Intel’s current difficult dilemma“
• “How does Micron make money? What investors should know?“
• “How does Texas Instruments make money? Amazing long term capital reward and company net profit margin!“
• “How AMD makes money? A rare case of turning defeat into victory“
• “Why is AMD’s performance so jaw-dropping?“
• “Qualcomm diversifies success, no nonger highly dependend on phone“
• “How does the ubiquitous Arm make money?“
• “Significant changes in Broadcom’s business approach“
• “The lucrative semiconductor supply chain“
• “Global semiconductor chip market in detail, big dominators and markets“
• “6 common wrong semiconductor investment myths“
• “How low-key Marvell makes money?“
• “Three EDA oligopoly vendors: Synopsys, Cadence, and Siemens’s Mentor Graphics“
• “How does, the EDA oligopoly, Cadence make money?“
• “How does Synopsis, the EDA oligopoly, make money?“

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