Technology funds heavily weighted to semiconductors and artificial intelligence beneficiaries have outperformed so far in 2024.
The Nasdaq index has continued to scale its all-time highs as technology company continue to deliver strong earnings while spending heavily on semiconductors.
The race amongst tech firms to train AI models has caused a boom in demand for the latest semiconductors, with no clear end in sight.
As such, exchange-traded-funds (ETFs) tracking the semiconductor industry are among the best performing funds year-to-date thanks to the performance of Nvidia alongside other semiconductor firms.
The VanEck Semiconductor UCITS ETF, HSBC Nasdaq Global Semiconductor UCITS ETF and the iShares Semiconductor ETF, are up 32.2%, 26.1% and 24.3% respectively.
But which active tech-focused funds have managed to take outperform their peers year-to-date without being invested purely in chip stocks?
Below are five of the best performing active technology funds eligible for distribution in Hong Kong and Singapore, based on data from FE fundinfo*.
NB 5G Connectivity
First in the list is the $1.1bn Neuberger Berman 5G Connectivity fund which is up 24.6% year-to-date.
This thematic fund focuses on investing in the key enablers and beneficiaries of 5G and future connectivity. It is managed by Yan Taw Boon, Hari Ramanan and Timothy Creedon.
This strategy has benefitted from its overweight positions in Nvidia, Taiwan Semiconductor Manufacturing Company and Meta, which are up 136%, 45% and 38% year-to-date respectively.
Janus Henderson Global Technology Leaders
The second top-performer is the $4.6bn Janus Henderson Global Technology Leaders fund, which is up 23% year-to-date.
This technology strategy aims to outperform the MSCI ACWI Information Technology Index & MSCI ACWI Communication Services Index. It is managed by Graeme Clark, Alison Porter and Richard Clode.
This relatively concentrated strategy has just 49 positions and more recently benefited from its close to maximum 10% weighting to Nvidia and Alphabet, which have outperformed year-to-date on the back of AI progress.
AB International Technology Portfolio
The $1.4bn Alliance Bernstein International Technology Portfolio fund is third in the list with a return of 20.2% year-to-date.
This fund aims to outperform the MSCI World Information Technology Index and is managed by Samantha S. Lau and Lei Qiu.
This strategy is slightly less concentrated with 80 positions but is has benefitted from letting its largest position Nvidia run. Large weightings to other semiconductor firms such as Broadcom and ASML have also contributed to its year-to-date gains.
UOB United E-Commerce
The UOB United E-Commerce has also managed to outperform year-to-date, up 20.2%.
This relatively small $25m strategy is managed by UOB Asset Management and has managed to perform well despite a 13.7% (as of its latest factsheet) weighting to Apple, which has struggled remaining relatively flat so far in 2024.
However, its top-10 positions in Alphabet, Meta and Taiwan Semiconductor Manufacturing Company have outperformed, boosting the fund’s returns.
Polar Capital Artificial Intelligence
This $827m Polar Capital Artificial Intelligence fund was another top-performer with a 19.1% year-to-date return.
This AI strategy was launched in 2017 and invests in companies exposed to not only artificial intelligence, but also process automation, robotics and materials science.
Polar Capital’s investment team is led by its partners Xuesong Zhao, Ben Rogoff and Nick Evans.
Alongside obvious holdings such as Nvidia and Microsoft, it has top-10 positions in firms such as Wal-Mart and Schneider Electric SE which have both outperformed year-to-date.
*The top-performing funds were measured in US dollar terms. The performance is based on data from FE fundinfo. The funds only includes products that fall under the Hong Kong SFC Authorised Mutual or Singapore Mutual equity technology sectors as classified by FE fundinfo.
