HSBC Asset Management has become the latest issuer in Europe to roll out a semiconductor ETF.
Olga de Tapia, Global Head of ETF & Indexing Sales, HSBC AM.
The HSBC Nasdaq Global Semiconductor UCITS ETF (HNSC LN) has been listed on the London Stock Exchange with further listings expected in Europe in the coming weeks.
The fund aims to replicate the performance of the Nasdaq Global Semiconductor Index, which is composed of the 80 largest global semiconductor companies.
It joins the $768 million VanEck Vectors Semiconductor UCITS ETF (SMH LN) and the $199m iShares MSCI Global Semiconductors UCITS ETF (SEMI NA) in offering UCITS access for European investors to semiconductor stocks globally.
The fund’s underlying Nasdaq index includes companies that supply semiconductors to the automotive, wireless communications, computing and consumer sectors.
To be eligible for inclusion in the index, a security must be classified within either the ICB semiconductor subsector or production technology equipment subsector and have a market capitalization of at least $150 million and a three-month average daily traded value of at least $1m.
The 80 eligible securities with the largest market capitalizations are selected for inclusion.
Stocks are weighted according to a modified market capitalization-weighted scheme that sets the five largest components as measured by market capitalization at their normal market- capitalization weight, subject to a cap of 8%, with all other components capped at a maximum weight of 4%.
Olga de Tapia, Global Head of ETF & Indexing Sales, HSBC AM, commented: “Semiconductors are key for the future of many technology-based industries and are also expected to play an important role in the transition to net-zero through enabling clean technologies.
“We feel that this addition to our tech thematic product suite captures a long-running secular trend which sits at the heart of the digital revolution”
Cameron Lilja, Vice President, Head of Index Research & Development, Nasdaq, added: “Semiconductors are essential to many aspects of modern society with increasing importance for rapidly evolving technologies. Leveraging our rules-based and transparent indexes, we are pleased to partner with HSBC AM, bringing investment products that enable investors to gain meaningful exposure to these pioneering companies who are reshaping the world economy.”
The fund has a total expense ratio of 0.35%.