The world of stocks is now pivoting towards a novel new domain of semiconductors as rising AI demand continues to favor the chip domain. Several hedge funds are now extremely bullish on semiconductors and semiconductor stocks, as rising demand for artificial intelligence tools and equipment is now making chips a necessary element to play around with, with the smart money pooling into the semiconductor sector holistically.
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Semiconductor Domain On The Rise
As per the latest update by the Kobeissi Letter, the best 2026 stock bet is accredited to the domain of semiconductors. Per the latest KL post, hedge funds are now increasing their exposure towards chips or semiconductor stocks, reflecting the 7.5% exposure of hedge funds. This metric has doubled since 2022, projecting the growing dominance of the sector in the world of stocks and trading.
In addition to this, the hedge funds’ net exposure towards the semiconductor domain has risen by 900%, signaling the most bullish bet of all time.
“Hedge funds are extremely bullish on semiconductor stocks. Semiconductor and semiconductor equipment stocks now reflect 7.5% of total global hedge fund market exposure, the highest on record. This metric has DOUBLED since 2022, driven by surging prices of the sector’s stocks and increasingly aggressive positioning. Meanwhile, net exposure, which measures positioning after accounting for hedges, is up to 10.5%, also an all-time high. Net exposure has risen +900% since 2022. Hedge funds are heavily exposed to chip stocks.”
Semiconductor ETFs Draw Significant Inflows
The rise of the semiconductor ETF “SMH” is proof enough of the trailblazing popularity of this domain. SMH recorded nearly $1.3B worth of inflows last week, signaling investors’ rising appetite towards tech and chip stocks. This domain has lately been
“BREAKING: The Semiconductor ETF, $SMH, posted a record +$1.3 billion in inflows last week. This now surpasses the previous high of +$1.2 billion seen in Q1 2022. This is also more than DOUBLE the weekly average seen this year. At the same time, the 3x leveraged long Nasdaq 100 ETF, $TQQQ, attracted a whopping +$1.2 billion in net inflows. As a result, US-listed ETFs took in +$43.0 billion during the week ending Friday, pushing year-to-date inflows to a record +$1.14 trillion. Investor appetite for tech stocks is through the roof.”
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