How to Invest in the Booming Chip-Tech Industry
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How to Invest in the Booming Chip-Tech Industry

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Investing in the Chip-Tech World Full

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Investing in the Chip-Tech World

How much of the modern world is powered by chip-tech? From computers and TVs to cars and washing machines, chips (or semiconductor devices) enable almost all of our digital goods.

When the COVID-19 pandemic brought the regular world to a halt, it put a focus on our increasingly digital world and personal electronics. Even as consumption of major purchases like vehicles slowed down, more than 1 trillion chips were shipped globally in 2020.

As economies picked up and demand increased across all goods, a global semiconductor shortage started to impact the largest companies and economies in the world. All of a sudden, the global semiconductor field was front-and-center in the minds of politicians, executives, and investors.

This graphic from eToro breaks down the importance of the semiconductor industry, and where moves are being made in it.

Understanding the Semiconductor Supply Chain

At its core, a chip or integrated circuit (IC) is a small device that contains electronic circuits on a semiconducting material.

Only a few millimeters wide, these chips (usually constructed on silicon) have millions of transistors packed into a tiny device. When designed and utilized together, they power devices and allow them to operate.

It’s a complex device that requires an extremely robust manufacturing system, capable of making millions of precisely designed products. The modern semiconductor supply chain has two primary business models:

  • Foundry model: Also known as fabless design, companies like NVidia and Qualcomm outsource production of chips to fabrication foundries like TSMC. They are then assembled and tested by specialty companies (OSATs) before being received by the end consumer.
  • Integrated model: Integrated device manufacturers (IDMs) are companies like Intel that design, manufacture, and sell their own chips. This was the traditional model of chip development before foundries took off, and many IDMs now outsource part of their production to foundries and OSATs.

As demand for semiconductor devices grew, a massive and sophisticated global supply chain formed to get chips from concept to consumer.

Market Share by RegionIDMFabless Foundry Wafer Production
U.S.51%65%0%13% (North America)
South Korea29%1%18%20%
Taiwan2%17%63%21%
Japan9%<1%0%16%
China<1%15%6%15%
Europe9%2%0%6%
Rest of World0%0%13%9%

Many of the pioneering companies in the field, like Taiwan’s TSMC and South Korea’s Samsung, became some of the world’s largest and most influential companies.

Anticipating the Chip-Tech Powered Future

The global economic impact of the semiconductor field is monumental, and its breadth is quickly becoming better understood.

In the U.S. alone in 2020, the semiconductor industry contributed an estimated $246.4 billion to the country’s GDP and almost 2 million jobs. When measuring direct, indirect, and value-added impacts of semiconductors, global GDP contribution estimates come in at $2.7 trillion.

But more than ever, recent disruptions to the supply chain have raised alarm bells and increased investment. Slashed forecasts from automakers and electronics manufacturers are increasing demand for chip production capacity, and chipmakers have already announced investments for new factories in 2021:

CompanyAnnounced Fab Investment (2021)Fab Location
TSMC$12B–$35BU.S. (Arizona)
Intel$20BU.S. (Arizona x2)
Intel$20BEurope
Samsung$17BU.S. (Texas)
GlobalFoundries$4BSingapore

And those six factories are just the beginning. Over the next two years, 29 fabrication factories are projected to be constructed globally, with total investment surpassing $140 billion.

Policymakers are stepping in as well, as countries race to increase market share in case of further disruptions. In June, the U.S. Senate passed a $250 billion tech and manufacturing bill with $52 billion earmarked for the semiconductor field specifically.

The timing is imperative, as an even more chip-dependent future continues to unfold. Driven by advances in 5G, A.I. and IoT in everything from automotive and electronics manufacturing to smart factories, chip-tech and investments in it are becoming more important than ever.

How Can Investors Take Part?

eToro’s Chip-Tech CopyPortfolio* gives investors direct access to the semiconductor technology market.

Curated by experienced and proven investment teams, the thematic portfolio offers exposure to a broad range of chip-makers and innovators in production, with no management fees.

*Your capital is at risk.
CopyPortfolios is a portfolio management product, provided by eToro Europe Ltd., which is authorised and regulated by the Cyprus Securities and Exchange Commission.

CopyPortfolios should not be considered as exchange traded funds, nor as hedge funds.

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Value in the Ground: Cartier Resources’ Chimo Mine Project

Cartier Resources (TSX-V: ECR) is advancing the Chimo Mine Gold Project in the Abitibi region of Quebec, showing its potential with past producing mines.

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Value in the Ground: Cartier Resources’ Chimo Mine Project

The sponsor of this graphic, Cartier Resources (TSX-V: ECR), has instigated an exploration strategy to increase ounces in the ground at the historic Chimo Mine in the heart of the Abitibi that continues to deliver increasing resources.

Cartier is deploying the strategy in the right region, with the right backers to find gold faster at a lower cost. This graphic provides an overview of the project’s massive potential.

Proven Endowment: The Abitibi Greenstone Belt

There are many prolific past-producing gold districts in Canada, but the Abitibi is one of the largest and well understood gold-bearing regions with readily available exploration infrastructure.

This region extends from Wawa in Northwestern Ontario to the East near Val-d’Or, Québec—a landscape that hosts some of the most productive gold mines in Canada.

Cartier’s Chimo Mine project located in the historic Abitibi Greenstone belt of Québec builds on a legacy of gold production with a project ready for investors.

Tried and Tested Exploration Strategy

The best place to find gold is where companies discovered and mined it before. Between 1964 and 1997, three companies produced 379,012 ounces of gold at the Chimo Mine.

This type of strategy is known as brownfield exploration. Brownfield exploration looks for gold in areas known to host gold mineralization. It offers investors less risk, reducing the amount of uncertainties a company faces.

Ounces in the Ground: Growing a Gold Resource

Cartier delivered its first-ever resource estimate within three years and proved the value at Chimo. In November 2019, the company published its first mineral resource estimate of the central gold corridor on the Chimo Mine property.

It reported Indicated resources of 481,280 ounces of gold and Inferred resources of 417,250 ounces of gold. This resource estimate came from only one-third of the property.

This was just the beginning for Cartier Resources and the Chimo Mine.

In 2021, Cartier upgraded its resource estimate with drilling from its North and South corridor. The company increased the indicated resources to 684,000 oz Au (6,616,000 tonnes at 3.21 g/t Au) and the inferred resources to 1,358,000 oz Au (15,240,000 tonnes at 2.77 g/t). This gives the property over 2 million ounces of gold in the heart of the Abitibi.

Why Invest in Chimo?

Cartier Resources has consistently applied an exploration strategy to develop and increase the known gold resources at the Chimo gold mine.

It built on the foundations of a proven past producer and continued exploration success to discover more gold. In the heart of a safe and established mining jurisdiction, Cartier has put the Chimo Mine back on the Abitibi gold map.

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Visualizing the Rise of Cryptocurrency Transactions

As cryptocurrency transactions rise, merchants are looking to position themselves to take advantage of this new wave of crypto spenders.

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daily crypto transactions

Visualizing the Rise of Cryptocurrency Transactions

After Bitcoin and cryptocurrency’s wild bull run in late 2020 and early 2021, many holders are now using cryptocurrencies for their intended purpose: payments.

Every day, approximately $12 billion are transferred across the Bitcoin, Ethereum, and Litecoin blockchains, with millions of people using cryptocurrency for payments daily.

This graphic sponsored by CoinPayments looks at the rising transactions of the Bitcoin, Ethereum, and Litecoin networks.

Cryptocurrency Transactions are Rising in Value and Number

While prices are often the focus when crypto is in the spotlight, transaction counts show how much a network is being used as a medium of exchange. In just over five years, daily transactions across the Bitcoin, Ethereum, and Litecoin networks increased sixfold, from just 250,000 to more than 1.5 million transactions a day.

In mid-2017, Ethereum overtook Bitcoin in daily transactions as ETH was necessary to participate in ICOs (initial coin offerings), which fueled much of the speculation in the 2017 price run. With Ethereum still hosting thousands of ERC-20 and ERC-721 tokens on its blockchain today, its transaction counts have grown to be much higher compared to Bitcoin and Litecoin’s.

Along with crypto’s rising transaction numbers, the average USD value per transaction has increased by a minimum of 4x over the past five years.

YearAverage Value per Bitcoin TransactionAverage Value per Ethereum TransactionAverage Value per Litecoin Transaction
2016$2,426$588$1,357
2021$32,943$19,139$5,458

Source: Coin Metric
2021 figures as of July 13th, 2021

Crypto Spenders are Searching for Merchants

As transaction counts and values rise, merchants play a vital part in pushing forward the adoption of digital currencies for payments.

Many cryptocurrency users consider merchant adoption as a key barometer of success for crypto adoption. While companies like AT&T, Namecheap, and Overstock already accept crypto payments, there are still many businesses around the world which don’t offer cryptocurrency as a method of payment.

In a survey of over 8,000 U.S. consumers, 66.7% of crypto owners and 54.2% of non-owners said that not enough merchants accept cryptocurrency. Along with this, 47% of crypto owners said they seek out merchants that accept crypto for purchases, indicating clear demand for more crypto-accepting businesses.

How Can Merchants Make the Most of the Crypto Boom?

As the world embraces crypto, merchants need the in-store and online tools to be part of this next wave of commerce. Accepting crypto opens merchants up to an untapped audience of new consumers, eager to spend their crypto.

CoinPayments makes it easy to start accepting crypto payments at online checkout and with POS systems, with features like auto-coin conversion and over 2,000 coins supported.

Find out more about how the crypto market is growing, adapting to consumer needs, and the opportunity it presents to merchants around the world.

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