Like Nvidia Stock but Prefer ETFs? This Is the Best Semiconductor ETF to Invest In Artificial Intelligence (AI) and Other Megatrends.
In 2024, the global semiconductor (or chip) market is projected to grow more than 13% to nearly $600 billion, according to the semiconductor Industry Association. Moreover, this market should reach $1 trillion in revenue by 2030, per top consulting firm McKinsey Company. These rosy growth projections are being driven by several massive global trends that are in their early innings, including artificial intelligence (AI), vehicle electrification, and autonomous driving, according to McKinsey.
Buying Nvidia (NASDAQ: NVDA) stock is one way to gain exposure to these trends. The company's graphics processing unit (GPU) chips have a dominant share of the data center AI market, whose growth has greatly accelerated due to generative AI. (This is the tech behind OpenAI's incredibly popular chatbot, ChatGPT.) And while Nvidia's auto business is still relatively small, it has the potential for huge growth once driverless vehicles become legal across the United States and beyond.
Some investors are understandably hesitant to buy Nvidia stock after its rapid run-up. The stock has soared 233% and 480% over the last year and three years, respectively, as of April 12. One great way to get considerable exposure to this top-performing stock but with less risk than buying it is to invest in an exchange-traded fund (ETF) that is heavily weighted with Nvidia stock: VanEck Semiconductor ETF (NASDAQ: SMH).
Source Fool.com
