The past five years have been great for investors in Taiwan Semiconductor Manufacturing (NYSE: TSM), popularly known as TSMC. Share prices of the company have shot up an impressive 258% during this period and outperformed the S 500 index's comparable gains of 81% by a huge margin.

TSMC's incredible rally could continue over the next five years as well. Let's take a closer look at why buying and holding this semiconductor stock for the next three years could be a smart move.

The global semiconductor market was worth an estimated $469 billion in 2018, according to the Semiconductor Industry Association. That number increased to $527 billion in 2023. So the semiconductor industry's revenue has increased at a compound annual growth rate (CAGR) of just 2.3% over the past five years.

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Source Fool.com