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For investors seeking momentum, PowerShares QQQ ETF (QQQ - Free Report) is probably on their radar now. The fund just hit a 52-week high and is up roughly 27.4% from its 52-week low price of $94.84/share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:
QQQ in Focus
QQQ provides exposure to the 107 largest domestic and international non-financial companies listed on the Nasdaq. The fund has a definite tilt toward large caps with significant concentration on the top firm – Apple (AAPL - Free Report) – at 10.9%. While information technology dominates the fund’s portfolio with 57.4% share, consumer discretionary and healthcare account for double-digit exposure each. The product charges investors 20 basis points in fees (see: all the Technology ETFs here).
Why the Move?
The broad U.S. stock market has been an area to watch lately given the Trump-induced rally and the flow of upbeat data. Trump has promised to accelerate economic growth, spend big time on infrastructure, reduce regulations, cut taxes and create more jobs in the country that will likely flood companies with excess cash and earnings growth. Additionally, the Fed’s second lift-off in a decade and its hawkish stance on 2017 infused optimism into the market, pushing the stocks higher. In particular, most of the stocks in the tech-heavy Nasdaq index are not plagued by financial trouble in a rising interest rate environment given that they have huge cash piles.
More Gains Ahead?
Currently, QQQ has a Zacks ETF Rank of 3 or 'Hold' rating with a Medium risk outlook. Therefore, it is hard to get a handle on its future returns in one way or the other. However, many of the segments that make up this ETF have a strong Zacks Industry Rank, so there is definitely some promise for those who want to ride this surging ETF a little further.
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Nasdaq ETF (QQQ) Hits New 52-Week High
For investors seeking momentum, PowerShares QQQ ETF (QQQ - Free Report) is probably on their radar now. The fund just hit a 52-week high and is up roughly 27.4% from its 52-week low price of $94.84/share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:
QQQ in Focus
QQQ provides exposure to the 107 largest domestic and international non-financial companies listed on the Nasdaq. The fund has a definite tilt toward large caps with significant concentration on the top firm – Apple (AAPL - Free Report) – at 10.9%. While information technology dominates the fund’s portfolio with 57.4% share, consumer discretionary and healthcare account for double-digit exposure each. The product charges investors 20 basis points in fees (see: all the Technology ETFs here).
Why the Move?
The broad U.S. stock market has been an area to watch lately given the Trump-induced rally and the flow of upbeat data. Trump has promised to accelerate economic growth, spend big time on infrastructure, reduce regulations, cut taxes and create more jobs in the country that will likely flood companies with excess cash and earnings growth. Additionally, the Fed’s second lift-off in a decade and its hawkish stance on 2017 infused optimism into the market, pushing the stocks higher. In particular, most of the stocks in the tech-heavy Nasdaq index are not plagued by financial trouble in a rising interest rate environment given that they have huge cash piles.
More Gains Ahead?
Currently, QQQ has a Zacks ETF Rank of 3 or 'Hold' rating with a Medium risk outlook. Therefore, it is hard to get a handle on its future returns in one way or the other. However, many of the segments that make up this ETF have a strong Zacks Industry Rank, so there is definitely some promise for those who want to ride this surging ETF a little further.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>