A surge in oil prices, fueled by the Middle East crisis, has heightened concerns that inflation could rise further. Although the United States and Iran reached a peace deal on Sunday, it is unlikely that oil prices will return to normalcy soon.
Investors have been dumping technology stocks and moving toward defensive assets. Even so, excitement surrounding artificial intelligence (AI) has continued to support companies with strong exposure to the AI space.
The growing demand for AI chips has provided a major lift to semiconductor stocks, which have played a significant role in driving the broader market’s gains over the past three years.
Given these trends, semiconductor funds, such as Janus Henderson Global Technology and Innovation Fund JNGTX, T. Rowe Price Science & Tech PRSCX and Fidelity Select Technology Portfolio FSPTX stand out as attractive investment opportunities.
Semiconductor Revenues Continue to Climb
The Semiconductor Industry Association (SIA) reported last week that global semiconductor sales reached $110.5 billion in April, up 11% from March’s total of $99.5 billion. Compared with April 2025, when sales stood at $56.9 billion, revenues surged 93.9% year over year.
“Global semiconductor sales increased on a month-to-month basis for the 14th consecutive month in April, and the global market continues to notch robust year-to-year growth driven by sales into the Asia-Pacific region, the Americas, and China,” John Neuffer, SIA president and CEO, said.
Semiconductors have become indispensable to nearly every current and emerging technology, including IoT, 6G and artificial intelligence. Rising demand from the automotive industry has also contributed to stronger chip sales. At the same time, the rapidly expanding AI market — still in its early stages of development — is encouraging major technology companies to commit billions of dollars toward development and infrastructure.
The SIA also endorsed the World Semiconductor Trade Statistics’ (WSTS) Spring 2026 forecast for the industry. WSTS expects the global semiconductor market to expand by 90% this year, reaching $1.51 trillion.
3 Best Choices
We have, thus, selected three mutual funds with significant exposure to semiconductor producers. These funds carry a Zacks Mutual Fund Rank #1 (Strong Buy) or 2 (Buy) and are poised to gain from the above factors. Moreover, these funds have encouraging three- and five-year returns. Additionally, the minimum initial investment is within $5000.
We expect these funds to outperform their peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance but also on the likely future success of the fund.