How to invest in the chipmakers fixing the semiconductor shortage

Last year’s chip crunch brought home how dependent the world is on these tiny pieces of silicon. Chipmakers are rushing to build new factories. Will they turn a shortfall into a glut? Alex Rankine reports

MoneyWeek cover illustration – semiconductors
(Image credit: © Howard McWilliam)

The world doesn’t have enough semiconductors. Over the past year shortages of these tiny pieces of silicon have had big consequences. Car assembly lines have been halted for want of chips; video gamers have found it almost impossible to acquire the latest consoles; politicians have been fretting about national security – it hasn’t escaped their notice that 92% of the world’s most advanced chips are made by just one firm: Taiwan Semiconductor Manufacturing (TSM).

Meanwhile, investors have been in the money. The PHLX Semiconductor Index, which tracks the industry’s leading lights, gained 43% last year. However, as firms rush to build new factories, some question whether the industry is about to go from shortages to an impending glut.

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Markets editor

Alex is an investment writer who has been contributing to MoneyWeek since 2015. He has been the magazine’s markets editor since 2019. 

Alex has a passion for demystifying the often arcane world of finance for a general readership. While financial media tends to focus compulsively on the latest trend, the best opportunities can lie forgotten elsewhere. 

He is especially interested in European equities – where his fluent French helps him to cover the continent’s largest bourse – and emerging markets, where his experience living in Beijing, and conversational Chinese, prove useful. 

Hailing from Leeds, he studied Philosophy, Politics and Economics at the University of Oxford. He also holds a Master of Public Health from the University of Manchester.