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Grab These Top-Ranked Tech ETFs to Buy the Dip

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The tech-heavy Nasdaq Composite recently witnessed its worst performance in April since 2008, losing 21.2%. The other two broad market indices also saw toughness as the Dow Jones Industrial Average and the S&P 500 indices witnessed their worst month since March 2020.

Many factors like the rising benchmark 10-year Treasury note yield, the Fed’s tightening of monetary policy, the Russia-Ukraine war crisis and resurging COVID-19 cases in China kept investors worried.

The dip in tech stocks has opened up great investing opportunities. JPMorgan Chase strategist Marko Kolanovic also commented that there are “great opportunities in high-beta, beaten-down segments that now include innovation, tech, biotech, emerging markets,” as mentioned in a Bloomberg article.

Investors willing to be part of the tech space can bet on some top-ranked technology ETFs like Vanguard Information Technology ETF (VGT - Free Report) , The Technology Select Sector SPDR Fund (XLK - Free Report) , iShares U.S. Technology ETF (IYW - Free Report) and First Trust NASDAQ-100-Technology Sector Index Fund (QTEC - Free Report) .

Notably, technology held an important position in the ongoing health crisis. Telemedicine and Digital Health received significant importance. Data management and storage have become integral aspects of healthcare today. Thus, with the technological advancements in the healthcare sector and the rising adoption of healthcare IT solutions as well as advantages of cloud usage healthcare, the cloud computing market is on a growth trajectory.

The pandemic-induced remote/hybrid working model has bumped up sales of PCs, laptops and other computer peripherals. Certain other ‘new normal’ trends have also emerged amid the health crisis, like growing inclination toward making digital payments, increasing video streaming and soaring video game sales.

The COVID-19 outbreak has been a blessing in disguise for the e-commerce industry as people are practicing social distancing and shopping online for all essentials, especially food items. The world is gradually moving toward digitization, increasing the dominance of technology in the financial sector.

The semiconductor space is attracting huge inflows in 2022 despite weakness in chipmaker stocks. A Bloomberg report highlights that chip ETFs have already witnessed around $6.8 billion of inflows until mid-April this year. The figure shows a staggering jump in inflows compared to investments of $5.2 billion and $2.1 billion in 2021 and 2020, respectively (per a Bloomberg report).

Technology ETFs to Keep Track of

The technology space can keep recovering in the second quarter of 2022, given its dominant role in maintaining social-distancing norms amid the pandemic and the growing investments in the space. Investors could consider the following ETFs:

Vanguard Information Technology ETF

Vanguard Information Technology ETF seeks to track the performance of the MSCI US Investable Market Information Technology 25/50 Index. VGT has AUM of $46.96 billion. It charges investors 10 basis points (bps) in annual fees. Vanguard Information Technology ETF currently sports a Zacks ETF Rank #1 (Strong Buy), with a Medium-risk outlook (read: Cloud Drives Microsoft Fiscal Q3 Earnings: ETFs to Buy).

The Technology Select Sector SPDR Fund

The Technology Select Sector SPDR seeks to provide investment results that before expenses generally correspond with the price and yield performance of the Technology Select Sector Index. XLK has AUM of $44.41 billion. It charges investors 10 bps in annual fees. The Technology Select Sector SPDR presently flaunts a Zacks ETF Rank of 1, with a Medium-risk outlook (read: Follow Warren Buffett With These ETFs).

iShares U.S. Technology ETF 

iShares U.S. Technology ETF seeks to provide investment results that before expenses generally correspond with the price and yield performance of the Russell 1000 Technology RIC 22.5/45 Capped Index. IYW has AUM of $7.53 billion. It charges investors 41 bps in annual fees, as stated in the prospectus. iShares U.S. Technology ETF currently sports a Zacks ETF Rank #1, with a Medium-risk outlook (read: Apple Beats on Earnings, Issues Weak Outlook: ETFs in Focus).

First Trust NASDAQ-100-Technology Sector Index Fund

First Trust NASDAQ-100-Technology Sector Index Fund seeks to replicate as closely as possible, before fees and expenses, the price and yield of the NASDAQ-100 Technology Sector Index. QTEC has AUM of $2.09 billion. It charges investors 56 bps in annual fees. First Trust NASDAQ-100-Technology Sector Index Fund also flaunts a Zacks ETF Rank #1 at present, with a High-risk outlook.

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