China semiconductor ETF: VanEck lists China Semiconductor UCITS ETF on the London Stock Exchange

VanEck has listed a China semiconductor ETF on the London Stock Exchange. The VanEck China Semiconductor UCITS ETF (ISIN IE000TS4B6Y3) began trading on 28 October 2026 in two share lines: SMHC in US dollars and SMCG in sterling.

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Article created by the editorial staff of ETFWorld.co.uk

Martijn Rozemuller, CEO of VanEck Europe

The fund tracks the MarketVector China Semiconductor 10% Capped Screened Index, a basket of 25 companies that derive at least half of their revenue from chips or chipmaking equipment. Its ongoing charges are 0.65% a year. VanEck describes the product as the first UCITS ETF in Europe dedicated to this segment.

VanEck China Semiconductor UCITS ETF: key facts

According to London Stock Exchange data, both lines trade on the Main Market in the ETF segment, with settlement through Euroclear Bank. The fund’s net asset value was USD 18.42 per share on 27 October 2026.

The ETF is a sub-fund of VanEck UCITS ETFs plc, an umbrella investment company registered with the Central Bank of Ireland. It is passively managed. On the same day, the fund also began trading on Borsa Italiana’s ETFplus market and on SIX Swiss Exchange.

A pure-play index of Chinese chip companies

The ETF aims to track, as closely as possible, the price and return performance of the MarketVector China Semiconductor 10% Capped Screened Index. The index is owned by MarketVector Indexes GmbH, a wholly owned subsidiary of VanEck Associates Corporation, and is administered and calculated by Solactive AG.

Selection follows a pure-play rule. To be included, a company must generate at least 50% of its revenue from semiconductors or semiconductor equipment. VanEck says the rule is designed to include only direct beneficiaries of the build-out of China’s domestic chip industry and to exclude diversified conglomerates with marginal chip exposure.

As the name indicates, each constituent’s weight is capped at 10%. The portfolio holds 25 stocks. According to the manager, its overlap with existing products on the market is limited.

Why VanEck is targeting the Chinese chip industry

In the launch announcement, Martijn Rozemuller, CEO Europe at VanEck, said China is building a fully independent supply chain in this field, covering chip design, manufacturing and assembly. He added that Chinese companies in the sector are not yet represented in a conventional semiconductor allocation, nor in a broader allocation to China, and that the new ETF is intended to fill this gap for investors.

According to VanEck, China is one of the world’s largest consumers of chips but has historically produced far fewer than it uses. Closing this gap has become a national priority, with Beijing directing funding towards domestic suppliers.

Equipment spending: the SEMI data

VanEck cites data from the industry association SEMI showing that in 2025 China invested more in semiconductor manufacturing equipment than any other country.

SEMI figures published in April 2026 put China’s equipment spending at USD 49.3 billion in 2025, down 0.5% on the previous year, out of a global total of USD 135.1 billion. Taiwan followed with USD 31.5 billion and South Korea with USD 25.8 billion.

Moritz Henkel, Product Manager at VanEck, said the result is a secured order book, which allows Chinese companies to grow before they have to compete on cost and performance at a global level.

US export controls and domestic demand

The announcement also links the investment case to US restrictions. The Bureau of Industry and Security (BIS) at the US Department of Commerce introduced export controls on semiconductors in 2022 and extended them in 2023 and 2024.

VanEck argues that, with strong political support, a protected market is emerging in China, where each foreign supplier facing restrictions creates an opening for a domestic one. The company gives two examples:

Chinese data centres facing limits on buying advanced Nvidia GPUs could turn to Cambricon;

Chinese fabs facing limits on sourcing equipment from Applied Materials or Lam Research could turn to NAURA.

The manager considers that the geopolitical pressure that creates uncertainty for investors could also support a longer-term opportunity.

VanEck’s semiconductor ETF range

The new fund sits alongside the VanEck Semiconductor UCITS ETF, launched in 2020. VanEck describes it as Europe’s first semiconductor ETF and reports assets under management of more than USD 8 billion, which places it among the largest sector ETFs in Europe (ETF Book data as of 27 October).

In the United States, VanEck launched a fund under the same ticker, SMHC, on Nasdaq in June 2026. That fund tracks a different index, the MarketVector China Semiconductor 25 Index.

VanEck was founded in 1955 and is headquartered in New York. It manages around USD 244 billion globally (as of 30 September 2026) across ETFs, active funds and institutional mandates, and offers more than 100 ETFs worldwide. Its European offices include London, Frankfurt, Milan, Madrid, Zurich and Amsterdam.

Risks of a China semiconductor ETF

VanEck itself states that investments in China and in the semiconductor sector carry specific risks, including:

concentration, as the portfolio holds 25 stocks from a single sector and a single country;

political and regulatory risk, including trade restrictions, which may adversely affect the fund’s performance;

volatility: the value of investments may fluctuate significantly, and investors may lose some or all of their capital.

Investors buying the sterling line are also exposed to movements between sterling and the US dollar, the fund’s base currency, and the currencies of the underlying holdings.

Conclusion

The listing of the VanEck China Semiconductor UCITS ETF gives UK investors exchange-traded access to an index of 25 Chinese companies with at least 50% of their revenue from semiconductors, a 10% cap per stock and a TER of 0.65%, in both US dollars and sterling.

VanEck’s investment case rests on the build-out of a domestic semiconductor supply chain in China, supported by state funding and by US export restrictions. The fund’s performance is likely to depend to a significant degree on the course of US-China trade policy.

Source: ETFWorld