Five years ago, a chip fund was a boring way to own "technology". Not anymore. The PHLX Semiconductor Index fell more than 12% last Thursday, its worst day since March 2020, then jumped nearly 7% on Monday. The same funds are still up for 2026. That's why we built Winvesta Crisps, to decode what's actually moving the funds you own, in plain language, before the consensus catches up. 60,000+ investors from all over India are already in. What about you?
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Last Thursday, the two biggest semiconductor ETFs lost roughly an eighth of their value in one session. SOXX, the iShares semiconductor fund, fell 12.15% to $131.90, per 24/7 Wall St. SMH, the VanEck fund, fell 11.21% to $447.73. By Monday, a rebound had already won back a chunk of it, with the S&P 500 up 2.35% to 7,549.94 and the semiconductor index up nearly 7%, per market reports.
Most Indian investors holding a chip fund now feel one of two urges. Sell before it happens again, or buy more because it is "on sale". Here's what the data says instead. Neither urge is based on what actually broke last week. Chips did not fall because chip demand vanished overnight. They fell because a crowded trade met a policy scare, and tonight a US inflation print lands that could decide whether the Fed adds a second.
🎯 Meet Vihaan
Let me introduce you to someone who might be you.
Vihaan is 31, a product manager at a software company in Pune. His US portfolio is worth ₹42 lakh. About ₹28 lakh sits in VOO, the Vanguard S&P 500 fund, built through three years of monthly investing. The other ₹14 lakh is in SMH, which he bought in two chunks in September and October, after a colleague showed him the fund's 2026 chart.
Vihaan did not check his portfolio on Thursday evening. When he did on Friday, SMH was down about ₹1.6 lakh in a day.
Vihaan's reality check. The Thursday sell-off was not one company's bad news. Per CNBC, the S&P 500 fell 4.36% to 7,353.73 and the Nasdaq Composite fell 5.52%, both the worst days since April 2025. Within the chip sector the damage was uneven. Micron fell 17.46%, Lam Research fell 16.36% and Nvidia fell 9.26%, per 24/7 Wall St. The equal-weight S&P 500 fell only about 2.9% that day, per CappNotes.
The explanations on offer were three. Democratic wins in the midterms raised fears of tougher rules on AI data centres. Hedge funds were selling this year's biggest winners to lock in gains, per a Nomura strategist. And two chip designers reported weak results, per Nationwide's Mark Hackett.
Vihaan thinks he owns an AI trade. He actually owns a bet that a handful of companies keep getting bigger orders, held at about a third of his US portfolio.
📊 What SMH, SOXX, VOO and RSP actually give you
SMH holds 25 stocks. SOXX holds 30. The two funds overlap on 23 names, or about 88% of their portfolios, per fund comparison data, so they usually move together. The difference is in the weights. SMH's top 15 holdings make up about 89% of the fund, against about 79% for SOXX, per the same comparison, because SOXX caps its biggest positions.
That cap mattered on Thursday. Nvidia alone is about 20.6% of SMH, per 24/7 Wall St., and it fell less than the memory and equipment names, which cushioned SMH. SOXX, with less Nvidia and more of the smaller names, fell harder. In a recovery led by Nvidia, SMH should do better. When Nvidia stumbles, SMH has less to hide behind. On Monday itself Nvidia fell about 4% while the rest of the sector rallied, after the company said it was investigating its chief executive over a reported personal relationship, per CNN and the New York Times.
Cost is nearly identical, at roughly 0.35% a year for SMH and 0.34% for SOXX, per fund comparison sites. Check the issuers' pages for the current figure.