Semiconductors

The logic behind this strategy is that the core drivers of the semiconductor industry stem from the synergy between value re-evaluation and the leverage effect. In terms of valuation, the key is to spot quality companies whose long-term assets and technological potential are undervalued by the market at the bottom of the industry cycle. From the leverage perspective, the capital-intensive and cyclical nature of the industry means that operational leverage (high fixed costs) and financial leverage can significantly amplify profit elasticity during economic upturns. Thus, the potential of this strategy lies in accurately navigating industry cycles and investing in companies with core competencies that can fully leverage these effects during recovery phases.