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Nasdaq Hits 10,000 for the First Time: ETFs to Bet On
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The year 2020 can be fully attributed to the Nasdaq, which hit the 10,000 mark for the first time ever on Jun 9. This marked the 18th record close for the Nasdaq in the year 2020 alone. Though the tech-heavy index shied away in the last hour of trading from the 10K mark — a psychologically pleasing level — the momentum has been pretty stellar. The gains in the index were powered by Apple (AAPL - Free Report) (up 3.2% on Jun 9) and Amazon (AMZN - Free Report) (up 3.04%).
Investors should note that after diving into a bear market in March, Wall Street made a strong comeback in the past two months on unprecedented stimulus both from the Fed and the government. The easing of lockdown measures in the United States in recent weeks and reopening of global economies have resulted in an uptick in activities that has bolstered investors’ confidence.
The latest bouts of data indicate that the economy is recovering faster than expected from the coronavirus lockdown and that the worst is probably over. While the key indexes of Wall Street have rallied past month, Nasdaq has been a true winner this year, with or without coronavirus.
The tech-heavy Nasdaq index outdid others in the peak of the pandemic due to greater rallies in the technology sector or socially-distant stocks, and continues to outperform even after the reopening of economies. The index was the first to recover year-to-date losses, and the first to beat its February high (read: Tech Rally Helps Nasdaq Turn Positive for 2020: ETFs to Play).
With expectations that the index will stay strong in the coming days, one can play the momentum with the below-mentioned ETFs.
This ETF provides exposure to the 103 largest domestic and international non-financial companies listed on the Nasdaq by tracking the Nasdaq-100 Index. QQQ is one of the largest and most popular ETFs in the large-cap space, with AUM of $111.76 billion. It charges investors 20 bps in annual fees.
First Trust NASDAQ-100 Equal Weighted Index Fund (QQEW - Free Report)
Holding 104 stocks, this fund provides equal exposure to the stocks of the Nasdaq-100 Index. It has amassed $836.9 million in its asset base. It charges 60 bps in annual fees.
Fidelity Nasdaq Composite Index Tracking Stock (ONEQ - Free Report)
This ETF tracks the Nasdaq Composite Index, holding a broad basket of 990 stocks. It has AUM of $2.68 billion. The expense ratio comes is 0.21%.
Investors seeking to make big gains in a short span can bet on QLD. It provides twice the return of the NASDAQ-100 Index’s daily performance. The fund has AUM of $2.54 billion and charges 95 bps in fees and expenses.
For a more bullish approach, TQQQ could be an excellent choice. It also tracks the NASDAQ-100 Index but offers thrice the returns of the daily performance, with the same expense ratio of QLD. The fund has managed AUM of $6.14 billion (read: A Quick Guide to 10 Most Popular Leveraged ETFs).
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Nasdaq Hits 10,000 for the First Time: ETFs to Bet On
The year 2020 can be fully attributed to the Nasdaq, which hit the 10,000 mark for the first time ever on Jun 9. This marked the 18th record close for the Nasdaq in the year 2020 alone. Though the tech-heavy index shied away in the last hour of trading from the 10K mark — a psychologically pleasing level — the momentum has been pretty stellar. The gains in the index were powered by Apple (AAPL - Free Report) (up 3.2% on Jun 9) and Amazon (AMZN - Free Report) (up 3.04%).
Investors should note that after diving into a bear market in March, Wall Street made a strong comeback in the past two months on unprecedented stimulus both from the Fed and the government. The easing of lockdown measures in the United States in recent weeks and reopening of global economies have resulted in an uptick in activities that has bolstered investors’ confidence.
The latest bouts of data indicate that the economy is recovering faster than expected from the coronavirus lockdown and that the worst is probably over. While the key indexes of Wall Street have rallied past month, Nasdaq has been a true winner this year, with or without coronavirus.
The tech-heavy Nasdaq index outdid others in the peak of the pandemic due to greater rallies in the technology sector or socially-distant stocks, and continues to outperform even after the reopening of economies. The index was the first to recover year-to-date losses, and the first to beat its February high (read: Tech Rally Helps Nasdaq Turn Positive for 2020: ETFs to Play).
With expectations that the index will stay strong in the coming days, one can play the momentum with the below-mentioned ETFs.
ETFs in Focus
Invesco QQQ (QQQ - Free Report)
This ETF provides exposure to the 103 largest domestic and international non-financial companies listed on the Nasdaq by tracking the Nasdaq-100 Index. QQQ is one of the largest and most popular ETFs in the large-cap space, with AUM of $111.76 billion. It charges investors 20 bps in annual fees.
First Trust NASDAQ-100 Equal Weighted Index Fund (QQEW - Free Report)
Holding 104 stocks, this fund provides equal exposure to the stocks of the Nasdaq-100 Index. It has amassed $836.9 million in its asset base. It charges 60 bps in annual fees.
Fidelity Nasdaq Composite Index Tracking Stock (ONEQ - Free Report)
This ETF tracks the Nasdaq Composite Index, holding a broad basket of 990 stocks. It has AUM of $2.68 billion. The expense ratio comes is 0.21%.
ProShares Ultra QQQ (QLD - Free Report)
Investors seeking to make big gains in a short span can bet on QLD. It provides twice the return of the NASDAQ-100 Index’s daily performance. The fund has AUM of $2.54 billion and charges 95 bps in fees and expenses.
ProShares UltraPro QQQ (TQQQ - Free Report)
For a more bullish approach, TQQQ could be an excellent choice. It also tracks the NASDAQ-100 Index but offers thrice the returns of the daily performance, with the same expense ratio of QLD. The fund has managed AUM of $6.14 billion (read: A Quick Guide to 10 Most Popular Leveraged ETFs).
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 >>