Retail investors have crowned semiconductor exchange-traded funds the hottest trade of 2026, leaving crypto ETFs with far weaker individual flows. Chip funds absorbed about $3.2 billion in net retail buying since January 2025.

The Kobeissi Letter cited J.P. Morgan equity strategy data through April 29, 2026. Retail buying has more than doubled in 2026 alone, suggesting a structural pivot toward artificial intelligence (AI) equities.

Hyperscalers including Microsoft, Amazon, Alphabet, Meta, and Oracle have guided 2026 capital expenditures of $600 billion to $720 billion, according to Kobeissi.

The figure marks a 36% to 70% year-over-year increase. About 75% of that spend funds AI infrastructure.

Global semiconductor revenue could top $1.3 trillion in 2026, the largest annual jump in two decades. Memory chips remain in short supply because AI workloads consume high-bandwidth memory at scale.

Producers like Micron, Nvidia, and Taiwan Semiconductor Manufacturing Company (TSMC) all stand to benefit.

Liquid cooling and efficiency upgrades have unlocked even larger data center builds across the United States and Asia.

In April 2026, two major chip funds absorbed about $5.5 billion in inflows. The VanEck Semiconductor ETF (SMH) and the iShares Semiconductor ETF (SOXX) split the record monthly haul.

Individual investors are piling into semiconductor ETFs at a historic pace:

Since January 2025, retail investors have purchased a net +$1.0 billion of the Semiconductor ETF, $SMH.

Over the same period, retail purchases in the 3x leveraged short semiconductor ETF, $SOXS, have… pic.twitter.com/n6nbkV8nio

April flows beat the prior record set in December 2025. The Philadelphia Semiconductor Index (SOX) climbed about 38.7% over the same stretch.

Crypto ETFs have not kept pace. Bitcoin (BTC) spot funds drew near $2 billion in April inflows, while Ethereum (ETH) products posted weaker or negative numbers.

Year-to-date returns for many crypto ETFs sit flat or lower. Bitcoin slid about 20% earlier in April before recovering.

Retail buying flows in both directions. The Direxion Daily Semiconductor Bull 3X ETF (SOXL) and its bear twin (SOXS) traded a combined 330 million shares per day.

The volume marked a 16-month high. SOXL volume topped 99% of weekly readings over the past five years. The split suggests traders hedge exposure as well as chase upside.

Retail investors are piling into leveraged semiconductor ETFs at an unprecedented pace:

Combined daily trading volume in the 3x leveraged short semiconductor ETF, $SOXS, and the 3x leveraged long semiconductor ETF, $SOXL, has surged to ~330 million shares, the highest in at… pic.twitter.com/6tRnn4VtO4

Leveraged products carry meaningful decay in choppy markets. Hyperscaler earnings in the coming weeks will test whether AI capex guidance holds. The hottest trade in 2026 still belongs to chips, not coins.

The post AI Capex Boom Drives Hottest ETF Trade Into Semiconductors, Not Crypto appeared first on BeInCrypto.

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