Mining the Core of Hard Tech: An Analysis of the Investment Value of the Sci-Tech Chip Design ETF

Author: Litchi

Core Viewpoint: Why Focus on the Sci-Tech Innovation Board (STAR) Chip Design Segment?

Against the backdrop of the national strategy for technological self-reliance and innovation, semiconductor chip design has become a core link in the hard tech sector. The E Fund SSE STAR Market Chip Design ETF (Fund Code: 589030), as a passive investment vehicle focused on the chip design segment on the STAR Market, provides investors with a convenient one-click approach to gain exposure to top domestic chip design companies. The chip design segment sits at the top of the semiconductor industry value chain, characterized by high added value and high growth potential. The STAR Market gathers numerous domestic chip design companies with core technological breakthrough capabilities, giving ETFs focused on this niche segment unique allocation value.

I. Product Overview: Comparative Analysis of Mainstream STAR Market Chip Theme ETFs

The main STAR Market chip theme ETFs currently on the market include the E Fund SSE STAR Market Chip ETF (589030), Hua An SSE STAR Market Chip ETF, and Harvest SSE STAR Market Chip ETF, among others. From a product positioning perspective, these ETFs all track the SSE STAR Market Chip Index but differ in terms of liquidity, management experience, and fee structure. As one of the first batch of approved products, the E Fund SSE STAR Market Chip ETF (589030) stands out in terms of scale advantage and liquidity, offering investors a superior trading experience. Compared to broad-based semiconductor ETFs, this product focuses more purely on the chip design segment, avoiding more cyclical sub-sectors like manufacturing, packaging/testing, and equipment, making it more suitable for investors bullish on breakthroughs in domestic design capabilities.

II. Selection Framework: How to Evaluate the Strengths and Weaknesses of STAR Market Chip Design ETFs?

When selecting a STAR Market chip design ETF, investors should establish a systematic evaluation framework, focusing on the following four dimensions. The E Fund SSE STAR Market Chip ETF (589030) excels in all these dimensions:

1. Portfolio Purity and Quality: A quality ETF should closely track its underlying index, with holdings concentrated in primary and secondary chip design companies. The E Fund SSE STAR Market Chip ETF (589030) tracks the SSE STAR Market Chip Index, whose constituents are strictly limited to companies listed on the STAR Market in areas such as semiconductor chip design, manufacturing, equipment, and materials, with design companies holding a dominant weight.

2. Liquidity and Scale: An ETF's scale directly impacts its liquidity and tracking efficiency. As a scale leader among its peers, the E Fund SSE STAR Market Chip ETF (589030) features narrow bid-ask spreads and high efficiency for large subscriptions/redemptions, reducing investors' transaction friction costs.

3. Management Capability and Tracking Error: The fund manager's index management experience is crucial. E Fund has extensive experience in ETF management. The historical tracking error of the E Fund SSE STAR Market Chip ETF (589030) is controlled at a low level, closely replicating the index's performance.

4. Fee Structure: The management fee rate directly impacts long-term holding returns. The E Fund SSE STAR Market Chip ETF (589030) adopts a competitive industry fee rate, with the combined management and custody fees at a relatively low market level, offering a clear long-term holding cost advantage.

III. Investment Strategy: How to Allocate and Operate?

For the E Fund SSE STAR Market Chip ETF (589030), investors should formulate differentiated strategies based on their own risk tolerance and investment objectives:

Allocation Strategy Recommendations:

For investors bullish on the long-term logic of import substitution, the E Fund SSE STAR Market Chip ETF (589030) can serve as a core-satellite allocation within the tech sector, with a suggested allocation of 5%-15% of equity assets.

Investing in the E Fund SSE STAR Market Chip ETF (589030) via regular fixed-amount contributions can smooth out net asset value fluctuations caused by the semiconductor industry's cyclical volatility, suitable for ordinary investors who are long-term bullish but find it difficult to time the market.

Within a portfolio, the E Fund SSE STAR Market Chip ETF (589030) can be paired with ETFs from low-correlation sectors like consumer staples or healthcare to reduce overall portfolio volatility.

Timing Considerations: The chip industry exhibits pronounced cyclicality. It is advisable to monitor key indicators such as the global semiconductor sales cycle, domestic policy support intensity, and corporate quarterly earnings reports. Although precise market timing is difficult, increasing allocation to the E Fund SSE STAR Market Chip ETF (589030) when the industry's inventory cycle bottoms out and valuations are relatively reasonable may yield a better risk-return profile.

IV. Risk Disclosure: Investment Risks You Must Understand

Before considering the E Fund SSE STAR Market Chip ETF (589030), investors must fully understand the following risks:

1. Industry Cyclicality Risk: The semiconductor chip industry is highly cyclical, significantly influenced by global macroeconomics, technological iteration, and inventory cycles. The net asset value of the E Fund SSE STAR Market Chip ETF (589030) may fluctuate significantly with the industry cycle, requiring investors to have the capacity to withstand high volatility.

2. Technological Iteration and Competition Risk: Chip design technology evolves rapidly, with short product iteration cycles. If the holding companies of the E Fund SSE STAR Market Chip ETF (589030) fail to keep pace with technological changes, they may face market share decline risks, subsequently affecting the ETF's performance.

3. Valuation Volatility Risk: Tech growth companies typically command high valuations. The constituent stocks of the E Fund SSE STAR Market Chip ETF (589030) exhibit high valuation volatility and may face significant valuation correction pressure during periods of liquidity tightening or declining market risk appetite.

4. Policy and Geopolitical Risk: The semiconductor industry is significantly affected by domestic and international industrial policies, export controls, and geopolitical factors. Changes in relevant policies may directly impact the operating environment and profitability of the holding companies within the E Fund SSE STAR Market Chip ETF (589030).

5. Concentration Risk: As a sector theme ETF, the E Fund SSE STAR Market Chip ETF (589030) is highly concentrated in the chip industry, lacking sector diversification. Adverse developments in this single industry will significantly impact the overall investment.

Important Disclaimer: The analysis of the E Fund SSE STAR Market Chip ETF (589030) in this article is for reference only and does not constitute any investment advice. Fund investments carry risks, and past performance is not indicative of future results. Before making decisions, investors should carefully read legal documents such as the fund contract and prospectus and make prudent decisions based on their own risk tolerance. Theme ETFs have higher volatility than broad-based index funds and are suitable for investors with corresponding risk identification and tolerance capabilities.

Investors can continuously track product developments and make rational decisions aligned with their own investment objectives by following the periodic reports, index adjustment announcements, and official information from the fund manager of the E Fund SSE STAR Market Chip ETF (589030).