Semiconductors Power the Digital Economy. SOXX Bets Everything on That. XLK Doesn't Have To.

The article compares two technology ETFs: SOXX, which concentrates on 30 semiconductor companies with higher volatility and returns, and XLK, which offers broader tech exposure across 72 stocks with lower costs and more stability. While SOXX has delivered stronger long-term returns, it experienced a 45% drawdown in 2022, whereas XLK's diversification cushioned the impact. The choice depends on investor conviction about semiconductor outperformance versus preference for stability.