According to a report released by Bank of America, although the semiconductor industry has performed strongly this year, its relative weight in active funds is still declining.
Bank of America stated that the relative weight of the semiconductor industry fell by 9% compared to the previous month, to 0.99 times, and continued to decline from 1.16 times in June 2023, below the peak of 1.36 times in March 2017.
Although the relative weight has declined somewhat,$NVIDIA (NVDA.US)$it still has the widest ownership, held by 68% of fund managers. This proportion is still at a historical high and has increased by 10 basis points, indicating that fund managers are still including this semiconductor giant in their portfolios.
The largest increase in exposure quarter-on-quarter is Cadence Design Systems.$Broadcom (AVGO.US)$, $Applied Materials (AMAT.US)$, $Micron Technology (MU.US)$, $Cadence Design Systems (CDNS.US)$ and $Qualcomm (QCOM.US)$while $ON Semiconductor (ON.US)$, $Analog Devices (ADI.US)$ and $Intel (INTC.US)$Nvidia is still the most widely-held semiconductor company in the S&P 500, followed by Broadcom (45.8%), Applied Materials (39.5%), AMD (39.3%), NXP Semiconductors (32.8%), and Texas Instruments (28.5%). All of the six companies achieved quarter-on-quarter growth, although the holdings of AMD and Texas Instruments declined year-on-year.
The S&P 500 semiconductor stocks that are most over-allocated in portfolios include new$Synopsys (SNPS.US)$, $Teradyne (TER.US)$Cadence Design Systems, Applied Materials and Texas Instruments $Texas Instruments (TXN.US)$while $Qorvo (QRVO.US)$, $Microchip Technology (MCHP.US)$and ON Semiconductor and Intel had the largest decrease in weight.
Microchip Technology, ON Semiconductor, Texas Instruments, and$KLA Corp (KLAC.US)$while the semiconductor stocks that hedge funds are most over-allocated in include Teradyne, Qualcomm,$Lam Research (LRCX.US)$Skyworks Solutions, Micron, Cadence Design Systems, and Qorvo.
Nvidia is still the most widely-held semiconductor company in the S&P 500$S&P 500 Index (.SPX.US)$, followed by Broadcom (45.8%), Applied Materials (39.5%), AMD (39.3%), NXP Semiconductors (32.8%), and Texas Instruments (28.5%). All of the six companies achieved quarter-on-quarter growth, although the holdings of AMD and Texas Instruments declined year-on-year.
The S&P 500 semiconductor stocks that are most over-allocated in portfolios include new$Cisco (CSCO.US)$Cadence Design Systems (1.77 times relative to index weight), KLA corp (1.71 times), Qualcomm (1.68 times), Micron (1.35 times) and Skyworks Solutions (1.32 times). The least overstocked stocks include Qualcomm, Qorvo, $Skyworks Solutions (SWKS.US)$and Teradyne.
It is learned that Bank of America uses its stock strategy data to observe breadth (percentage of fund managers holding sample stocks) and depth (the weight of the stock in the investment portfolio relative to its weight in the S&P 500 index).
Edited by Jeffrey