Eurex has launched futures on the STOXX® Semiconductor 30 index, offering investors liquid exposure to an economic sector that’s led market returns in the last couple of years.
The STOXX Semiconductor 30 Index is comprised of US-listed securities issued by companies classified within the Semiconductors and Production Technology Equipment ICB Subsectors. The stocks are ranked by free-float market capitalization and the top 30 make it into the index. Constituents are weighted by size, with a single-stock cap at the time of reweighting of 8% and a 45% combined weight limit for companies with an individual weight of over 4.5%.
Chipmakers have been at the center of the latest equity market rally, driven by strong demand for semiconductors, in particular from developers of artificial intelligence technologies. Nvidia, the largest component in the STOXX Semiconductor 30 index, last month reported that fourth-quarter revenue rose 265% from a year earlier, beating analysts’ forecasts. CEO Jensen Huang said that “the conditions are excellent for continued growth.”[1] The company’s shares have risen nearly 500% since the start of 2023.[2]
According to McKinsey, global semiconductor sales may grow to USD 1 trillion by 2030 from USD 600 billion in 2021.[3] About 70% of growth is predicted to be driven by three industries: automotive (particularly electric vehicles), data storage (AI and cloud computing) and wireless (smartphones, 5G).
“The STOXX Semiconductor 30 Index represents the leading companies within a rapidly flourishing industry, all meticulously selected through a rules-based and transparent methodology,” said Axel Lomholt, General Manager at STOXX. “Our collaboration with Eurex signifies a terrific opportunity to further enrich the derivatives market, particularly in connection with themes and sectors, leveraging our innovative index-based solutions.”
Figure 1: Index performance
Figure 2: Top ten holdings
[1] CNBC, “Nvidia posts revenue up 265% on booming AI business,” February 21, 2024.
[2] Data through March 4, 2024.
[3] McKinsey, “The semiconductor decade: A trillion-dollar industry,” April 1, 2022.