latest from Economist on semiconductor industry:

Taiwan Semiconductor Manufacturing Company, which makes 90% of the world’s chips with the smallest, most efficient circuits, will report its quarterly results on Thursday. Investors expect a strong showing. Nonetheless, chipmakers face tougher times ahead. One problem is supply. Sales of laptops and smartphones, where half of chips are used, soared during covid-19 lockdowns. To meet demand, investment in production boomed. But much of the new capacity will arrive later this year, when demand is expected to drop. Another worry is geopolitics. Policymakers want to bring more of the chip manufacturing supply chain within their own borders. Such fragmentation would drive up costs and leave chip firms beholden to the whims of party politics. Another chip giant, Intel, has threatened to postpone the launch of two American factories because of a delay by Congress in passing a subsidies bill worth $52bn over five years to American chipmakers. A soaring TSMC may be about to fall back down to earth.

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Here is a link to a Morningstar article on the risks and benefits of investing in thematic ETFs.

https://www.morningstar.com.au/etfs/article/3-things-to-know-about-thematic-funds/201852

This point particularly resonated with me:

3. The odds are stacked against investors in thematic funds, but the prospective payouts are big

Investors in thematic funds are making a three-way bet. They are betting that they will: 

• pick a winning theme,
• select a fund that is well-placed to harness that theme, and
• see valuations that indicate that the market hasn’t already priced-in the theme’s potential.
• The odds of winning these bets are low, but the prospective payouts can be large.

The long-term performance figures for thematic funds are pretty unflattering. As the chart below shows, just 45 per cent of all thematic funds launched prior to 2010 survived to 2020. Only a fourth managed to both survive and outperform the MSCI World Index over that 10-year span.That said, those that who do win, can win big. For example, those who invested in the ARK Next Generation Internet ETF back at the beginning of 2015 would have raked in annualised returns of 27 per cent through the end of 2019 - three times the return of the MSCI World Index over the same period. It’s performances like these that perpetuate these funds’ allure.