Seizing the 'Chip' Opportunity in AI Hardware: This Semiconductor Enhanced Fund Outperforms Peers Over One and Three Years

The first half of 2026 concluded with AI hardware, represented by semiconductors, leading the market gains. According to Wind data as of June 30th, the Shenwan Semiconductor Index more than doubled with a gain of 106.20% for the first half of the year, ranking high on the Shenwan secondary industry performance list. The A-share market capitalization of the semiconductor sector surpassed 14 trillion yuan, topping the Shenwan secondary industry rankings.

Industry analysis suggests that the expansion in the semiconductor sector's market capitalization stems from a deep resonance between the AI supercycle and the logic of domestic substitution. On one hand, the explosive growth in global AI computing power indicates the industry may sustain high prosperity. WSTS forecasts the global semiconductor market will achieve 90% growth in 2026, reaching a total scale of $1.51 trillion, with further growth expected in 2027 to approximately $1.9 trillion. On the other hand, domestic substitution is accelerating from being 'usable' to 'high-performing'. Supported by policies and industrial capacity expansion, China's semiconductor industry is poised to occupy a more significant position in the global technology competition landscape, becoming a core pillar industry driving the development of China's new quality productive forces and the construction of a technological powerhouse.

To better assist investors in capturing the 'chip' opportunities in semiconductors, Harvest Fund has established a comprehensive matrix of active and passive semiconductor products. According to the latest performance rankings from Galaxy Securities, as of June 30, 2026, the Harvest CSI Semiconductor Industry Index Enhanced Fund (Initiative) A (014854)/C (014855), a thematic index-enhanced product, ranks first in its category for both the past one-year and three-year returns. Its one-year return ranks first among Enhanced Thematic Index Equity Funds (A Class)/(Non-A Class) (A Class rank 1/25, C Class rank 1/31). Its three-year performance also leads its peer group of Enhanced Thematic Index Equity Funds, with the A Class ranking 1/25 and the C Class ranking 1/23.

Since its inception, the fund has delivered excess returns outperforming its benchmark for investors. From its establishment on April 22, 2022, to June 30, 2026, the Harvest CSI Semiconductor Industry Index Enhanced Fund (Initiative) A achieved cumulative net value growth of 337.41%, surpassing its benchmark return of 319.87% over the same period by more than 17 percentage points.

Information shows that the Harvest CSI Semiconductor Industry Index Enhanced Fund (Initiative) employs an index-enhanced investment strategy, using the CSI Semiconductor Industry Index as the target benchmark for its portfolio. It utilizes quantitative methods for active index portfolio management and risk control, aiming to 'surpass the benchmark'. The CSI Semiconductor Industry Index, which it tracks, selects no more than 40 securities of listed companies involved in semiconductor materials, equipment, and applications from A-share markets as index components, with an overall bias towards the semiconductor equipment and materials segments.

In terms of sector distribution, according to Wind statistics as of June 30th, categorized by Shenwan tertiary industry, the CSI Semiconductor Industry Index has relatively high weightings in semiconductor equipment, digital chip design, and semiconductor materials, at 62.8%, 17.5%, and 9.6% respectively, with a combined weighting of nearly 90%, precisely targeting the core domestic substitution track. The Harvest CSI Semiconductor Index Enhanced Fund is expected to provide a favorable option for investors who wish to track the semiconductor market with ease while striving for excess returns.

Looking ahead, the semiconductor sector is currently under the triple resonance of cyclical recovery, new AI-driven growth, and domestic substitution. The length, breadth, and intensity of this new cycle may far exceed previous ones. A Huatai Securities research report points out that under high AI prosperity, capacity expansion in advanced processes, HBM, and advanced packaging will drive sustained incremental demand for equipment. Equipment manufacturers may benefit from long-term structural tailwinds under this decade-spanning investment cycle.

Liu Bin, Chief Investment Officer of Index and Quantitative Investment at Harvest Fund and portfolio manager of the Harvest CSI Semiconductor Index Enhanced Fund, believes that from a long-term perspective, greater focus should be placed on sub-sectors within semiconductors experiencing technological breakthroughs, industrial upgrades, and supply shortages. This is especially true for areas where the depth of domestic substitution intersects with high demand, such as high-end chip design and semiconductor equipment and materials. Semiconductor equipment and materials, as the core battleground for increasing domestic production rates, are expected to see a wave of capacity expansion supported by policies and the National Integrated Circuit Industry Investment Fund.

Considering the increased volatility in the current semiconductor sector, it is recommended that investors adopt strategies such as regular fund investments or purchase high-performing funds in batches during sector pullbacks. These approaches may further enhance the investment experience.