New Delhi, March 26 -- The war in Iran and consequent blockage of the Strait of Hormuz offer a stark reminder of a different geopolitical risk, one lurking in tech-heavy global portfolios that are betting on artificial intelligence: Taiwan.

Beijing claims the self-ruled island as its own and intends to unify it with the mainland, by force if necessary, making Taiwan a geopolitical tripwire. Investors often put Taiwan in the "too big to fail" bucket, meaning China wouldn't dare attack anytime soon because of the cascading ramifications. Their reasoning: If China were to invade, its damage wouldn't be just to holdings such as Taiwan Semiconductor Manufacturing, which makes more than 90% of advanced semiconductors, but to the entire global ...