SMH vs SOXX - Semiconductor ETF Comparison (Which ETF Is The Better One?)

SMH vs SOXX - Semiconductor ETF Comparison (Which ETF Is The Better One?). In this comparison video I will talk about SMH vs SOXX.

So, the main difference between them is their underlying indexes and management.
SMH is a passively managed exchange-traded fund (ETF) managed by VanEck. The ETF is run by referring to the performance of the MVIS US Listed Semiconductor 25 Index. Its managing entity and the adopted underlying index give SMH the upper hand in the semiconductor sector. On the other hand, SOXX is also a passively managed ETF by iShares, tracking the performance of the PHLX Semiconductor Sector Index.
Therefore, the ETFs are passively managed in reference to different indexes.

Investment return-based performance
Return-based performance is a crucial metric that weighs an ETF’s profitability on an investment. Within the last decade, SMH has outsmarted SOXX in terms of annualized returns with an average return of 28.15%, 3.70% more than that of SOXX. This suggests that investments made to SMH have a higher return probability than those made on SOXX.
SMH has the upper hand in this category due to its higher annual return rates.

Expense ratio
This is an annual rate ETF charges on the total assets it holds to reimburse for portfolio management, administration fees, and other applicable costs. Currently, SMH demands a 0.35% expense ratio on total assets, whereas its SOXX counterpart calls for a 0.46% ratio. Therefore, SMH has a 0.06% lower ratio than SOXX.
In this category, SMH outsmarts SOXX due to its friendlier expense ratio.

But do they have similarities?
Yes, they do. The most apparent similarity between SMH and SOXX is that they are both passively managed ETFs. Also, both ETFs present with relatively larger volatilities, which affect their price fluctuations within a given time frame. However, SOXX volatility is currently lower than SMH's, hence, it has fewer investment risks. Lastly, the ETFs' risk-adjusted performance ratios, such as their sharp ratios, fluctuate with time almost similarly, tracing identical ratio-time graphs.

To sum up, which is better – SMH or SOXX?
As a long-term investor in ETFs, I'm impressed with SOXX volatility, which reduces investment risks to certain levels. On the other hand, I like SMH's provisions even more because of its higher return-based performances and low expense ratios. I, therefore, settle for SMH as the ultimate winner due to its slight edge over SOXX.

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[Optimus-Prime-Rib]

What about SOXQ. Almost same as SOXX but a expense ratio of 0.19

[GilEpshtain]

You didbt talked at all on the main differnce which is how there holding is calculated. SMH give higher weight to bigger componey while SOXX tries to not give overweight to a single compony