Taiwan has announced that it expects to receive an exemption from the Trump administration’s 100% semiconductor tariff. This news has led to an increase in Taiwan Semiconductor Manufacturing Company (TSMC) shares.<\/p>\n
Currently, no additional details about the exemption have been released. On the other hand, the Philippines Semiconductor Industry President has expressed concerns about the impact of the 100% tariff, stating it is devastating for the industry.<\/p>\n
The Philippines rely heavily on semiconductor exports, with 70% of its exports comprising semiconductors. The potential exclusion of TSMC from the tariff could create an uneven playing field in the industry.<\/p>\n
Based on this news from August 7, 2025, we should expect significant volatility in the semiconductor space. The key is the phrase “no further details,” which creates uncertainty that options traders can use. Implied volatility on semiconductor stocks, especially in the SOXX ETF, has likely jumped, suggesting big price swings are anticipated.<\/p>\n
For those bullish on the exemption holding, buying call options on TSMC (TSM) is the most direct strategy. Given TSMC’s dominance, holding over 60% of the global foundry market share as of early 2025, an official exemption would secure its position and likely push the stock much higher. We could structure this as a bull call spread to define our risk.<\/p>\n
Conversely, the broad semiconductor sector appears vulnerable. We should consider buying put options on a basket of other Asian chipmakers or the SOXX ETF itself. With the Philippines citing a “devastating” impact, and electronics making up over 60% of their exports in 2024, other regional producers without exemptions will face severe margin pressure.<\/p>\n
We must remember the tariff escalations of the 2018-2020 period, where initial announcements were often followed by reversals or changes. This history suggests that the current optimism around TSMC could be premature, making protective puts on TSM a sensible hedge against a policy reversal. A sudden change could erase today’s gains just as quickly as they appeared.<\/p>\n
A pairs trade is likely the most effective approach in the coming weeks. We can go long on TSMC while simultaneously going short on the SOXX ETF. This strategy isolates the effect of the exemption, betting on TSMC’s outperformance relative to its struggling competitors.<\/p>\n
Finally, we should look at the ripple effects on US tech companies. Firms like Apple and Nvidia, who are major TSMC customers, are now facing a complex situation with their other suppliers. Any disruption to the broader supply chain could increase their costs, making put options on these names an interesting secondary play.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" TSMC shares rise as Taiwan expects tariff exemption; Philippines warns of devastating impact on exports.<\/p>\n","protected":false},"author":62,"featured_media":17028,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-28437","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/28437","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=28437"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/28437\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/17028"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=28437"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=28437"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=28437"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}