VanEck Launches China Semiconductor ETF As Beijing’s $98 Billion Chip Push Gains Steam

VanEck has launched the VanEck China Semiconductor ETF (NASDAQ:SMHC), a new fund aimed at providing investors with pure-play exposure to China’s rapidly expanding domestic semiconductor industry. The launch extends the firm’s semiconductor ETF lineup, which already includes the VanEck Semiconductor ETF (NASDAQ:SMH) and the VanEck Fabless Semiconductor ETF (NASDAQ:SMHX).

The new ETF arrives as China accelerates efforts to build a self-sufficient chip ecosystem amid ongoing U.S. export restrictions. According to VanEck, most global semiconductor portfolios remain heavily concentrated in U.S., Taiwanese and European companies, leaving investors with little exposure to China’s domestic semiconductor build-out. John Patrick Lee, Senior Product Manager at VanEck said that SMHC was designed to bridge that gap through a rules-based investment vehicle focused exclusively on companies benefiting from the country’s semiconductor expansion.

Key Features

• Tracks the MarketVector China Semiconductor 25 Index.
• Provides exposure to China’s domestic semiconductor value chain, including chip designers, equipment makers and advanced packaging firms.
• Invests only in companies headquartered or incorporated in China or Hong Kong.
• Constituents must derive at least 50% of revenue from semiconductors or semiconductor equipment.
• Holds 25 companies selected through a rules-based methodology.
• Portfolio is weighted by modified free-float market capitalization with position caps.
• Index is rebalanced quarterly.

Why VanEck Sees The Opportunity

• China was the world’s largest spender on semiconductor manufacturing equipment in 2025, outspending every other country or region.
• Beijing has made semiconductor self-sufficiency a national priority, directing government agencies, state-owned enterprises, and strategic industries to favor domestic suppliers.
• U.S. export controls have accelerated demand for homegrown alternatives across the semiconductor supply chain.
• China’s National IC Fund has committed approximately $98 billion across three phases since 2014.
• The fund’s latest phase, launched in 2024, allocated $47.5 billion to support semiconductor development.

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