Half-time Report: Semiconductors Ignite 17% Portfolio Lead

“Pheeeeep!”

The first half came to an end and my football team of stocks blazed it with a commanding 17% lead, ahead of all major indices.

The scintillating display of SG semiconductor related companies – AEM Holdings (AWX), UMS Integration (558) and Micro-Mechanics (5DD) – boosted the SG portfolio with an astonishing 26% return for the first half.

Unfortunately, it’s a different story for my US portfolio.

While it has emerged from the deep red since the first quarter, the portfolio is still down by 4.7%, trailing SPDR SP500 ETF (SPY) by a huge gap.

At the end of the day, overall team performance is simply the collective result of individual player performance. Let’s look closer at the team sheet to see who was lifting the squad to glory and who was leaking goals.

The Mid-Match Analysis: Top & Bottom 5 Stocks

It’s no surprise that AEM, UMS Integration, and Micro-Mechanics are among the top scorers for the first half. The surge in their stock prices over the second quarter has been phenomenal, especially for AEM.

With an astonishing 519% return, only a disastrous second half will prevent it from securing this year’s Golden Boot award.

However, the deepest satisfaction goes beyond the actual numbers on the scoreboard. It comes from having recognised these opportunities a few years ago, long before the broader market caught on.

Obviously, I cannot foresee the future.

If I could, I would have sold everything else and put it all into AEM. I also didn’t have perfect visibility into the insatiable demand wave hitting memory chips and advanced packaging at the time.

But being able to act on a strong qualitative sensing without total certainty, and having the patience to sit tight while the thesis unfolded? That is what makes this game truly gratifying.

Not Just Semiconductors: Form is Temporary Class is Permanent

You didn’t necessarily need to be heavily exposed to semiconductor manufacturers to put numbers on the board this half. The floodlight on them has overshadowed other excellent performers on the pitch.

For one, the continued strength of Singapore banks has been a pleasant surprise. Not only have they held the defensive line with their consistent dividends, but they have contributed positively to the scoreline too.

I certainly did not expect another 30% return from OCBC (O39) so far this year, especially with the headwinds from lowered interest rates.

As for Arista Networks (ANET), it was sitting in the red (-15%) just a quarter ago. But the market sentiment completely flipped in April, driving a dramatic reversal that has put it up by a whopping 31%.

This kind of rapid turnaround in the US markets is exactly why I am not overly concerned about our current goal leakers.

Form fluctuates, but the underlying quality remains.

Recycled Capital to Higher Conviction Stocks

The divestments of Novo Nordisk (NVO) and Zscaler (ZS) back in April to recycle capital mean they are no longer in this latest list.

While their share prices have recovered slightly since then, I don’t regret my decisions, and that comes down to two clear factors:

• Gains in Recycled Capital: The sales proceeds were immediately deployed to add to my high-conviction holdings in ServiceNow (NOW) and Shopify (SHOP).
  
  Both, together with the initial position in the Vanguard Total International Stock Index Fund ETF (VXUS) have notched solid gains of their own since the reallocation.
  
• Higher Long-Term Conviction: Over a multi-year horizon, I simply have far greater confidence that this recycled capital will generate a superior risk-adjusted return.

Intuitive Surgical: When Blind Over-Optimism Flips to Irrational Pessimism

Intuitive Surgical (ISRG) has always been one of my favourite growth leaders. If not for my mistake of taking way too much profit back in 2023, it would easily be among my top portfolio positions today.

Fundamentally, there is absolutely nothing wrong with its underlying business engine.

In April, Intuitive reported a robust start to the year. Driven by the accelerating rollout of the da Vinci 5 (dV5) platform, 1Q2026 revenue jumped 23% YOY to US$2.77 billion, while Non-GAAP EPS leaped an incredible 38% to US$2.50.

The recent sell-off is a classic case of the market swinging from wild over-optimism into intense over-pessimism.

Toward the end of last year, Wall Street pushed the share price sky-high to nearly US$600.

But when management guided for temporary near-term gross margin compression due to the dV5 production ramp-up, the market threw a tantrum and completely dumped the premium.

Interestingly, this drag has now pushed the stock down below US$400 — a level not seen since mid-2024, right after the initial launch of the da Vinci 5!

It’s as if the market has entirely dismissed two full years of incredible commercial progress and massive ecosystem adoption.

I already added two tranches to my position this past March and May, and I am now considering adding a little more. I remain confident in its long-term structural growth potential and believe my patience will be duly rewarded in time.

As for Tractor Supply (TSCO), Ulta Beauty (ULTA), and Veeva Systems (VEEV), I just wrote on them last month. You can catch up on my [deep dive into why I bought these stocks] during this current market sell-off.

Second Half: Anything Could Still Happen

I’m obviously delighted with the first-half performance, which is already ahead of last year’s returns in both percentage and absolute terms.

However, there is still an entire second half left to play; it is far too early to pop the champagne.

Remember how Brazil snatched a dramatic 95th-minute victory against Japan, or how Belgium overcame the two goals deficit deep into the second half and equalised against Senegal in the final minutes before winning it in extra time.

The match simply isn’t over until the final whistle blows.

While the stock market is rarely that theatrical on a day-to-day basis, a lot can happen in the span of six months.

That said, I’m not going to spend my time worrying about macroeconomic shifts that are entirely beyond my control.

Instead, I will continue to monitor how the businesses in my portfolio navigate these uncertain waters, and simply adjust my game plan or make the necessary tactical substitutions if the situation calls for it.

I’m ready for the second-half kickoff. Are you?

Note: Missed the tactical setup? Read my previous post on [portfolio allocation] to see the full defensive and offensive strategy.