Taiwan Semiconductor Manufacturing Company (TSMC) is the world's largest contract semiconductor manufacturer. Founded in 1987 by Morris Chang in Hsinchu, Taiwan, TSMC has a market share of over 50% and a customer base that includes some of the biggest names in the industry, such as Apple, Qualcomm, and Nvidia. Mr. Chang, now 92 years old, worked at Texas Instruments for 25 years and pioneered the controversial-at-the-time pricing scheme called “ahead of the cost curve.” The idea was to price new chips at lower margins to get more volume which would lead to higher yields and, in turn, higher margins. TSMC has built its business off of this idea and now the moat is so large, it would be challenging to catch up.
The Taiwan closed end fund has good monthly factsheet commentary covering stocks there that I have covered in my fund posts... IF we are talking tech, there would be a number of Taiwanese stocks started by returnees from Silicon Family or they are local SME family businesses that make particular niche tech parts, say, the usb power/data connector or port on your smartphone, and they would have limited competition in such niches as there would be high barriers to entry... Anything in Taiwan closely related to AI has already gone parabolic and should be stayed away from as its too late to get into those! 😀 Although I did one writeup recently on Yageo Corp which is an indirect play as a fund had mentioned it: https://emergingmarketskeptic.substack.com/t/taiwan
A good quick overview that I linked to in today's post: https://emergingmarketskeptic.substack.com/p/emerging-markets-week-march-18-2024
I think there are many other interesting and overlooked stocks in Taiwan that TSMC overshadows though...
Awesome, thanks! Care to share any?
The Taiwan closed end fund has good monthly factsheet commentary covering stocks there that I have covered in my fund posts... IF we are talking tech, there would be a number of Taiwanese stocks started by returnees from Silicon Family or they are local SME family businesses that make particular niche tech parts, say, the usb power/data connector or port on your smartphone, and they would have limited competition in such niches as there would be high barriers to entry... Anything in Taiwan closely related to AI has already gone parabolic and should be stayed away from as its too late to get into those! 😀 Although I did one writeup recently on Yageo Corp which is an indirect play as a fund had mentioned it: https://emergingmarketskeptic.substack.com/t/taiwan
Thanks!
Great interview
Thanks so much Patrick