With increasing advancement of technology and digitization in almost every field, the need for semiconductor products is growing rapidly. Mutual fund investments in semiconductor stocks are now likely to be among the most lucrative investments. These small and powerful chips are responsible for everything-from consumer electronics to industrial machinery. Such demands and growth are seen all over the semiconductor landscape. The semiconductor ecosystem in India, too, is enjoying good momentum with several of the landmark projects now getting approved. Here are some of the top semiconductor mutual funds:
Aditya Birla SL Digital India Fund
They plan to enhance capital in the long-run through investing in companies engaged in technology and technology-orientated activities. The fund will have an asset allocation of 100% towards equity in this entire universe. It includes the domains of hardware, peripherals, software, telecom, media, the internet, e-commerce, and understanding other technology-enabled businesses. The scheme shall also be used for generation of income through IDCW income distribution and capital withdrawal. It proposes to invest a minimum of eighty percent of its assets into equity and equity-related instruments of technology companies and may invest up to twenty percent of assets in debt and money market instruments to manage liquidity.
ICICI Prudential Technology Fund
ICICI Prudential manages the Technology Fund as a long-term investment aimed at capital appreciation by building a portfolio of equity and equity-related investments in technology and technology-dependent company stocks. The scheme manages total assets worth Rs 11,158.89 crore and benchmarks its performance against Nifty 50 TRI. Overall, it has an allocation of 6.98% in semiconductor stocks of HCL Technologies Ltd. It ranks among the top 5 stock holdings in the fund. As of August 2023, the scheme has a very strong allocation of 71.44% in large-cap stocks and 10.94% and 10.52% in mid- and small-cap stocks, respectively.
Fidelity Select Technology Portfolio FSPTX fund
The fund targets capital appreciation primarily from equity securities. Mainly focusing on stocks of firms that provide, use, or develop products, processes, or services significantly benefiting from technological advancements and improvements. This product belonging to the Zacks Sector-Tech has been providing positive total returns for over a decade. Particularly, this non-diversified has earned total returns of 31.1% and 30.5% over the past three years and the last five years, respectively.
Tata Digital India Fund
The Tata Digital India Fund has a long-term objective to provide capital growth through the majority of its investments in equity and equity-related instruments of Indian companies. Which are operating in the Information Technology Sector. As per market capitalization, as of August 2023, the scheme has a significant allocation of 72.53% to large caps, 10.37% to mid-caps, and 10.78% to small caps. At this moment, the scheme has AUM amounting to Rs 7862.86 crore and 7.43% allocation to Semiconductor stocks.
Investing in mutual funds that capitalize on semiconductors can open opportunities in an exciting way, even though it comes with its own risks. That is why we presented a list of top semiconductor mutual funds. An investor must therefore consider his/her risk tolerance, financial goals, and time horizon before making any investment decisions. Thus, a thoroughly informed way is assured into the semiconductor sector.
