SOXX ETF Beats IYW with 111% One-Year Return
iShares Semiconductor ETF outperforms its broader tech counterpart by over 70 points in the past year, driven by AI chip demand.
Key points
- SOXX returned 111.1% over one year, outperforming IYW's 36.3% return as of September 22, 2026.
- SOXX has a 0.33% expense ratio and $41.2 billion in assets, compared to IYW's 0.37% and $25.2 billion.
- SOXX carries a higher beta of 2.33 and a max drawdown of -45.8%, reflecting its concentrated semiconductor focus.
The iShares Semiconductor ETF (SOXX) delivered a one-year return of 111.1% as of September 22, 2026, significantly outpacing the iShares U.S. Technology ETF (IYW), which returned 36.3% over the same period. This performance gap highlights the divergent risk profiles of the two funds, with SOXX focused exclusively on chipmakers and IYW covering the broader Russell 1000 technology sector.
SOXX manages $41.2 billion in assets and carries a 0.33% expense ratio, slightly lower than IYW’s 0.37% fee on $25.2 billion of assets. While both funds are issued by iShares, their composition differs sharply: SOXX holds 34 semiconductor-related companies, whereas IYW holds approximately 150 stocks across software, services, and hardware.
Cost and size metrics favor SOXX
SOXX’s lower expense ratio of 0.33% compared to IYW’s 0.37% results in marginally lower annual costs for investors. The fund also offers a higher trailing 12-month dividend yield of 0.29%, paying $1.25 per share, versus IYW’s 0.10% yield and $0.25 per share. These figures reflect the different capital structures of the underlying holdings, with SOXX concentrated in high-growth hardware manufacturers.
In terms of scale, SOXX’s $41.2 billion in assets under management exceeds IYW’s $25.2 billion, suggesting greater liquidity and market presence for the semiconductor-focused fund. The share price for SOXX stood at $569.03, while IYW traded at $265.92, though price alone does not indicate value relative to the net asset value.
Risk profiles differ due to sector focus
SOXX exhibits higher volatility, with a five-year monthly beta of 2.33 compared to IYW’s 1.50. The semiconductor fund also experienced a maximum drawdown of -45.8% over five years, deeper than IYW’s -39.4% decline. This increased sensitivity to market swings is a direct consequence of SOXX’s pure-play exposure to the chip industry.
Despite the higher risk, SOXX generated a total return of $3,809 from an initial $1,000 investment over five years, outperforming IYW’s $2,575. This superior long-term growth is attributed to the strong performance of key holdings such as Nvidia, Advanced Micro Devices, and Micron Technology, which benefit from sustained demand in computing infrastructure.
Diversification trade-offs influence investment choice
IYW provides broader exposure by including software, IT services, and media technology, with semiconductors comprising only about 40% of its holdings. Its top positions include Nvidia, Apple, and Microsoft, offering a more balanced view of the U.S. tech sector. Investors prioritizing stability and sector-wide growth may find IYW’s diversification advantageous.
Conversely, SOXX’s concentration in 34 semiconductor firms allows for amplified gains when the chip sector leads market rallies, particularly in AI-driven cycles. As noted by The Motley Fool, this pure-play approach can yield higher returns but carries the risk of sharper declines if the semiconductor industry faces headwinds. The choice between the two depends on an investor’s tolerance for volatility and specific sector outlook.
