Why Direxion Daily Semiconductor Bull 3X ETF Dropped Today
Key PointsThe Trump Administration may permit Apple to buy memory chips from China.
Direxion Daily Semiconductor Bull 3X Shares ETF (SOXL) faced a 8% drop today after soaring 32% in the first two weeks of August. This momentum ETF, which multiplies semiconductor stock performance by 3x, is now reacting to a Trump Administration decision allowing Apple to buy memory chips from Chinese suppliers ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies Corp (YMTC).
CXMT creates DRAM memory and aims to produce high-bandwidth memory (HBM) for AI, while YMTC produces NAND flash memory also used in AI. These moves threaten Micron, SOXL's biggest holding at 8.6%, and AMD and Nvidia, its Nos. 2 and 3 biggest holdings. Despite Micron's 5% drop today, other SOXL holdings are also in the red. The risk of investing in leveraged tech ETFs like SOXL is evident, as their performance hinges on semiconductor stock trends.
Written by urgent.news from Yahoo Finance's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
This story
This is one outlet's version. Read the fullest account.
