Technology ETF Showdown: Is SOXX or IYW the Better Buy for Investors Right Now?
Written by Katie Brockman for The Motley Fool -> SOXX offers a lower expense ratio and higher dividend yield than IYW. SOXX has outperformed IYW in both one- and five-year total returns but exhibits higher volatility. IYW offers more diversified tech exposure, with 139 holding
SOXX offers a lower expense ratio and higher dividend yield than IYW.
SOXX has outperformed IYW in both one- and five-year total returns but exhibits higher volatility.
IYW offers more diversified tech exposure, with 139 holdings, compared to SOXX's 30-stock portfolio.
Both the iShares Semiconductor ETF (NASDAQ:SOXX) and the iShares U.S. Technology ETF (NYSEMKT:IYW) target the U.S. tech sector, but they take different approaches.
While IYW tracks a broad index of technology companies, including software and internet giants, SOXX focuses exclusively on the hardware-heavy semiconductor industry.
This distinction in scope leads to different risk-reward profiles for growth-oriented investors who may be weighing broad tech exposure against a more concentrated play on the essential chips powering global innovation and artificial intelligence.
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
SOXX is slightly more affordable with a lower expense ratio, and it also offers a higher dividend payout. These yield differences reflect the cash-flow characteristics of their underlying semiconductor and broad-tech holdings.
