Traders are buying the chip selloff with leverage at a record pace

$SOXL, the 3x leveraged semiconductor ETF, has pulled in about $3.8 billion of new money this week, on pace for its largest weekly inflow ever per Bloomberg data

That is more than the $2.9 billion it took in during all of March, a record month at the time with nearly half of it coming from Korean retail buyers

The money is pouring in even though $SOXL is down nearly 21% this week. The Philadelphia Semiconductor Index has dropped 12% over six sessions, wiping out roughly $1 trillion in chip market value

The unleveraged $SMH added more than $430 million in three days, on track for its best week since early September

At the same time, CNN's Fear and Greed Index fell to 25 this morning, right at the Extreme Fear line and its lowest reading since late June. It was near 40 a week ago

Stock price strength, market breadth and safe haven demand are all flashing Extreme Fear

Even after the drop, $SOXL is still up about 163% this year and $SMH about 57%, which is why buying every chip dip keeps getting rewarded

The broader tape is the most fearful it has been in months while retail keeps reaching for 3x chip exposure. That has paid all year, but leverage cuts both ways with hot CPI and PPI pushing rate hike odds higher. A fund that falls 21% needs about a 27% rally just to get back to even, so the next leg likely depends on hyperscaler capex guidance later this month confirming the AI demand story

Source: StockMarket.News