FAI vs. SMH

Last updated Jun 23, 2026

FAI (First Trust Bloomberg Artificial Intelligence ETF) and SMH (VanEck Semiconductor ETF) are both exchange-traded funds - FAI is a Technology Equities fund tracking the Bloomberg Artificial Intelligence Index, while SMH is a Semiconductors fund tracking the MVIS US Listed Semiconductor 25 Index. Both are passively managed. Over the past year, FAI returned 66.20% vs 157.81% for SMH. Their correlation of 0.85 suggests significant overlap in exposure. FAI charges 0.65%/yr vs 0.35%/yr for SMH.

Performance

FAI vs. SMH - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in First Trust Bloomberg Artificial Intelligence ETF (FAI) and VanEck Semiconductor ETF (SMH). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, FAI achieves a 34.05% return, which is significantly lower than SMH's 85.74% return.

FAI

• 1D: -0.48%
• 1M: 7.16%
• YTD: 34.05%
• 6M: 33.89%
• 1Y: 66.20%
• 3Y*: —
• 5Y*: —
• 10Y*: —

SMH

• 1D: 1.37%
• 1M: 16.07%
• YTD: 85.74%
• 6M: 85.96%
• 1Y: 157.81%
• 3Y*: 66.26%
• 5Y*: 40.65%
• 10Y*: 38.85%

*Multi-year figures are annualized to reflect compound growth (CAGR)

FAI vs. SMH - Yearly Performance Comparison

	2026 (YTD)	2025	2024
FAI First Trust Bloomberg Artificial Intelligence ETF	34.05%	33.37%	2.28%
SMH VanEck Semiconductor ETF	85.74%	49.17%	0.29%

Correlation

The correlation between FAI and SMH is 0.82, indicating a strong positive relationship between their price movements. Combining them offers limited diversification - they tend to fall together during downturns.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.82
Correlation (All Time) Calculated using the full available price history since Nov 21, 2024	0.85

The correlation between FAI and SMH has been stable across timeframes, ranging from 0.82 to 0.85 - a consistent structural relationship.

Return for Risk

FAI vs. SMH — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.

FAI

FAI Risk / Return Rank: 70
FAI Sharpe Ratio Rank: 80
FAI Sortino Ratio Rank: 67
FAI Omega Ratio Rank: 70
FAI Calmar Ratio Rank: 72
FAI Martin Ratio Rank: 62

SMH

SMH Risk / Return Rank: 96
SMH Sharpe Ratio Rank: 97
SMH Sortino Ratio Rank: 94
SMH Omega Ratio Rank: 94
SMH Calmar Ratio Rank: 97
SMH Martin Ratio Rank: 97

The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

FAI vs. SMH - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for First Trust Bloomberg Artificial Intelligence ETF (FAI) and VanEck Semiconductor ETF (SMH). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.

Values are calculated on a 1-year rolling basis and updated daily. Risk-adjusted metrics are more stable over longer periods — use the period switch above to explore them.

	FAI	SMH	Difference
Sharpe ratio: Return per unit of total volatility	2.47	4.66	-2.19
Sortino ratio: Return per unit of downside risk	2.97	4.60	-1.64
Omega ratio: Gain probability vs. loss probability	1.40	1.66	-0.25
Calmar ratio: Return relative to maximum drawdown	3.53	10.63	-7.10
Martin ratio: Return relative to average drawdown	11.01	38.91	-27.90

FAI vs. SMH - Sharpe Ratio Comparison

The current FAI Sharpe Ratio is 2.47, which is lower than the SMH Sharpe Ratio of 4.66. The chart below compares the historical Sharpe Ratios of FAI and SMH, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Drawdowns

FAI vs. SMH - Drawdown Comparison

The maximum FAI drawdown since its inception was -27.82%, smaller than the maximum SMH drawdown of -84.96%. Use the drawdown chart below to compare losses from any high point for FAI and SMH.

Drawdown Indicators

	FAI	SMH	Difference
Max Drawdown Largest peak-to-trough decline	-27.82%	-84.96%	+57.14%
Max Drawdown (1Y) Largest decline over 1 year	-18.84%	-14.93%	-3.91%
Max Drawdown (3Y) Largest decline over 3 years	—	-35.74%	—
Max Drawdown (5Y) Largest decline over 5 years	—	-45.30%	—
Max Drawdown (10Y) Largest decline over 10 years	—	-45.30%	—
Current Drawdown Current decline from peak	-4.79%	0.00%	-4.79%
Average Drawdown Average peak-to-trough decline	-5.36%	-41.01%	+35.65%
Ulcer Index Depth and duration of drawdowns from previous peaks	6.03%	4.07%	+1.96%

Volatility

FAI vs. SMH - Volatility Comparison

The current volatility for First Trust Bloomberg Artificial Intelligence ETF (FAI) is 13.67%, while VanEck Semiconductor ETF (SMH) has a volatility of 17.29%. This indicates that FAI experiences smaller price fluctuations and is considered to be less risky than SMH based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	FAI	SMH	Difference
Volatility (1M) Calculated over the trailing 1-month period	13.67%	17.29%	-3.62%
Volatility (6M) Calculated over the trailing 6-month period	22.18%	28.18%	-6.00%
Volatility (1Y) Calculated over the trailing 1-year period	27.02%	34.14%	-7.12%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	30.90%	35.68%	-4.78%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	30.90%	32.95%	-2.05%

FAI vs. SMH - Expense Ratio Comparison

FAI has a 0.65% expense ratio, which is higher than SMH's 0.35% expense ratio.

Dividends

FAI vs. SMH - Dividend Comparison

FAI has not paid dividends to shareholders, while SMH's dividend yield for the trailing twelve months is around 0.17%.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
FAI First Trust Bloomberg Artificial Intelligence ETF	0.00%	0.00%	0.04%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%
SMH VanEck Semiconductor ETF	0.17%	0.31%	0.44%	0.60%	1.18%	0.51%	0.69%	1.50%	1.88%	1.43%	0.80%	2.14%

Frequently Asked Questions

Can I hold both FAI and SMH in my portfolio?

FAI and SMH have a correlation of 0.82, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, FAI or SMH?

SMH has higher volatility (17.29%) compared to FAI (13.67%). In terms of maximum drawdown, FAI dropped -27.82% vs SMH's -84.96%.

Which ETF is better, FAI or SMH?

On 1-year performance, SMH leads with 157.81% vs 66.20% for FAI. On fees, SMH is cheaper at 0.35% per year. On volatility, FAI has been the lower-risk option at 13.67%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, FAI or SMH?

Over the 1-year period, SMH has performed better with a 157.81% return vs 66.20%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, FAI or SMH?

SMH is cheaper with a 0.35% expense ratio, compared with 0.65% for FAI.

Which ETF pays a higher dividend yield, FAI or SMH?

SMH has the higher dividend yield at 0.17%, compared with 0.00% for FAI.

What is the main difference between FAI and SMH?

FAI is categorized as Technology Equities, while SMH is Semiconductors. FAI tracks Bloomberg Artificial Intelligence Index, while SMH tracks MVIS US Listed Semiconductor 25 Index. They also come from different issuers: First Trust and VanEck. Their fees differ too: 0.65% for FAI and 0.35% for SMH.

Which has better risk-adjusted returns?

SMH currently has the higher Sharpe Ratio (4.66 vs 2.47), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.