<\/div><\/div>Investment Opportunities in Core Links of the Semiconductor Industry Chain - In-Depth Analysis of Semiconductor Equipment ETF E Fund
\nKeywords: Semiconductor Equipment ETF; E Fund; CSI Semiconductor Materials and Equipment Theme Index; Domestic Substitution; Upstream of Industry Chain; Investment Tool
\nIntroduction
\nAgainst the backdrop of increasingly fierce global technological competition, the semiconductor industry has become a core pillar of national strategic competitiveness. As the "heart" of modern information technology, the development level of the semiconductor industry directly determines the technological boundaries of cutting-edge fields such as artificial intelligence, 5G communications, cloud computing, and new energy vehicles. Within the semiconductor industry chain, equipment and materials have long been regarded as the "bottleneck" with the highest technical barriers and the most urgent need for domestic substitution. In recent years, driven by sustained domestic policies and the deepening of independent and controllable industrial chain strategies, the upstream sector of semiconductors is experiencing historic development opportunities. Against this backdrop, the Semiconductor Equipment ETF E Fund (159558, Link Fund A\/C: 021893\/021894), with its precise index tracking positioning and professional fund management capabilities, has become a convenient tool for investors to position themselves in the core upstream track of semiconductors.
\nI. The Foundation of the Semiconductor Industry: Core Value of Equipment and Materials
\nThe semiconductor industry chain can be roughly divided into design, manufacturing, packaging and testing, as well as the equipment and materials that support manufacturing and testing. Among them, equipment and materials are at the very upstream of the industry chain, serving as the "mother machines" and "basic raw materials" for semiconductor manufacturing. According to industry statistics, semiconductor equipment accounts for over 70% of capital expenditure in wafer manufacturing, while semiconductor materials (such as silicon wafers, photoresists, electronic specialty gases, and targets) are key guarantees for process yield and performance. However, for a long time, the global semiconductor equipment market has been dominated by overseas giants such as Applied Materials, ASML, and Tokyo Electron, with the domestic self-sufficiency rate of equipment below 20%. In the field of high-end materials, the domestic penetration rate of some key materials is even below 10%. This pattern of external dependence not only restricts the independent development of China's semiconductor industry but also poses severe supply chain security risks.
\nIn recent years, driven by heightened geopolitical uncertainty and the strong push of the "domestic substitution" strategy, local equipment and materials companies have ushered in an unprecedented development window. From cleaning equipment to etching equipment, from thin-film deposition to inspection equipment, many domestic manufacturers have achieved breakthroughs from zero to one and are accelerating their entry into the supply chains of mainstream wafer fabs. At the same time, the semiconductor materials field has also seen the emergence of companies with international competitiveness, such as NAURA Technology Group, AMEC, NSIG, Yake Technology, and Red Avenue New Materials. These companies not only benefit from the incremental demand brought by the expansion of domestic wafer fabs but also continuously increase product value through technology iteration, becoming core assets of long-term focus in the capital market.
\nII. CSI Semiconductor Materials and Equipment Theme Index: Precisely Positioning the Upstream Track
\nThe CSI Semiconductor Materials and Equipment Theme Index tracked by the Semiconductor Equipment ETF E Fund is one of the few flagship indices in China that focuses on the upstream equipment and materials segments of the semiconductor industry chain. This index selects representative listed companies in the semiconductor equipment and materials field as constituent stocks, comprehensively covering core equipment areas such as etching, deposition, cleaning, polishing, and inspection, as well as key material sub-sectors including silicon wafers, photoresists, electronic gases, and wet electronic chemicals. Compared with common semiconductor thematic indices on the market (such as those favoring design or manufacturing), this index has distinct characteristics of "heavy assets, high technical barriers, and high growth elasticity."
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\nAs shown in the figure above, this index has demonstrated strong growth elasticity in historical trends, especially during periods when domestic substitution policies catalyze resonance with the wafer fab expansion cycle, its increase often significantly outperforms the broader market. In terms of constituent stock composition, the top ten heavy stocks include leading companies in sub-sectors such as NAURA, AMEC, and NSIG, combining industry representativeness with liquidity. This index-based investment approach can effectively diversify the operational risk of a single company while fully capturing the overall growth dividend of the upstream industry chain, making it particularly suitable for investors who are optimistic about the long-term trend of semiconductors but lack individual stock research capabilities.
\nIII. Semiconductor Equipment ETF E Fund: A Sharp Tool for Domestic Substitution
\nAs one of the top public fund companies in China, E Fund has accumulated rich experience in index investing, with a comprehensive ETF product line, standardized operations, and good liquidity. The Semiconductor Equipment ETF E Fund (159558), listed on the exchange, provides investors with a convenient channel to one-click position themselves in the core upstream assets of semiconductors. This ETF invests no less than 95% of its net asset value in the index constituent stocks and alternative constituent stocks, aiming to closely track the performance of the underlying index. For investors unable to participate in on-exchange trading, its Link Fund (Class A 021893\/Class C 021894) offers the convenience of off-exchange subscription, further lowering the investment threshold.
\nFrom an investment value perspective, positioning in the semiconductor equipment and materials sector at the current point in time is supported by three logics: first, on the demand side, capital expenditure by major domestic wafer fabs remains high, with a new wave of expansion peaks expected from 2025 to 2026, leading to strong equipment procurement orders; second, on the supply side, domestic equipment companies are making continuous breakthroughs in sub-segments, with some products already achieving verification and importation for processes from 90nm to 28nm, and moving toward advanced process nodes, offering vast import substitution space; third, on the policy side, the third phase of the China Integrated Circuit Industry Investment Fund (Big Fund) has been launched, focusing on equipment, materials, and advanced manufacturing, with capital empowerment accelerating corporate R&D breakthroughs and capacity expansion.
\nIn addition, from a valuation perspective, after nearly two years of adjustment, the price-to-earnings ratio of the semiconductor equipment and materials sector has fallen from historical highs to reasonable ranges. The PEG (Price\/Earnings to Growth) ratio of some leading companies has dropped below 1, offering better safety margins and medium-to-long-term allocation value.
\nIV. Investment Outlook and Risk Warning
\nLooking ahead, the domestic substitution process upstream of the semiconductor industry chain will not happen overnight, but the trend is already established. For long-term investors, participating in this process through the Semiconductor Equipment ETF E Fund can avoid the risk of picking the wrong "dark horse" stock while sharing in the overall growth of the industry. It should be noted that the semiconductor industry has significant cyclical volatility, and the equipment and materials sector is greatly affected by factors such as downstream demand fluctuations, technology roadmap changes, and overseas trade policies. Investors should reasonably assess their own risk tolerance and adjust positions dynamically based on market changes. It is recommended to adopt a regular investment or phased buying approach to smooth out the psychological pressure caused by short-term fluctuations.
\nConclusion
\nSemiconductor equipment and materials are not only the technological high ground of the industry chain but also a key breakthrough point for the national strategy of scientific and technological self-reliance and self-improvement. The Semiconductor Equipment ETF E Fund (159558) and its Link Fund, by precisely tracking the CSI Semiconductor Materials and Equipment Theme Index, provide ordinary investors with a professional, low-cost, and highly transparent investment tool. Driven by the dual forces of the domestic substitution wave and industrial upgrading, this ETF is expected to become an excellent choice for investors to seize semiconductor upstream investment opportunities. Whether for long-term holders seeking to share in technology dividends or traders looking for sector rotation opportunities, they can include it in their asset allocation observation range, while seizing the opportunities of the times and managing risks well.
\n(Risk warning: Funds have risks, and investment should be cautious. The content of this article is based on public information analysis and does not constitute any investment advice. Before making investment decisions, investors should carefully read the fund contract, prospectus and other legal documents, and fully consider their own risk tolerance.)
