Chip Bulls Lie in Wait

"If I feel this is sustainable, then I will start looking at these types of assets," said Forbes Watson, a small-cap portfolio manager with Voyageur Asset Management. "The problem with this industry is that it's cyclical and it fights technological obsolescence so quickly. Buying them and owning them for six months of the year is market-timing and speculation. I don't do either one."

Watson runs about $650 million, with about 25% of it in the technology sector. But the tech holdings are in software and services, not in hardware. He said recent talk out of the semiconductor industry has been fairly positive, but he needs to hear more.

"I will be late to this party," Watson said. "I don't know when it begins, but I'm willing to wait until it starts and then be fashionably late."

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