We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The technology sector has shown strong resilience amid the coronavirus pandemic. In fact, it has driven the bull market since the March lows and has been the best-performing sector so far this year with the S&P 500 Information Technology climbing more than 26%. In comparison, the S&P 500 and Nasdaq Composite Index has gained 4.4% and 24.9%, respectively.
The gains were primarily driven by mega-cap companies, especially the FAANG stocks though these have bled lately on elevated valuation concerns. Notably, after an astounding surge since the March lows, these stocks are now selling at very rich valuations. Still, they are fundamentally strong.
This is especially true as the COVID-19 pandemic has led to the global digital shift, which has accelerated e-commerce for everything ranging from remote working to entertainment and shopping. The resurgence in coronavirus cases lately and the prospect of lockdowns will continue to fuel demand for Internet (read: Stay-At-Home ETFs to Soar Further on New Lockdown Measures).
Further, the rapid adoption of cloud computing, big data, Internet of Things, wearables, VR headsets, drones, virtual reality, artificial intelligence, machine learning, digital communication and 5G technology will continue to drive the sector higher. As companies across sectors and many individuals are dependent on remote working, cloud-computing services have become essential.
Given this, we have highlighted those tech ETFs that are at the forefront of the broad market rally this year.
ARK Next Generation Internet ETF (ARKW - Free Report) – Up 88.6%
This is an actively managed fund focusing on companies that are expected to benefit from the shift in technology infrastructure to cloud, enabling mobile, new and local services. The fund holds 49 stocks in its basket with AUM of $2.4 billion. It trades in an average daily volume of 726,000 shares and charges 76 bps in annual fees from investors (read: Internet ETFs Are Hot Picks Amid the Coronavirus Crisis).
It is an actively managed fund seeking long-term capital appreciation by investing in companies that benefit from the development of new products or services, technological improvements and advancements in scientific research. In total, the fund holds 47 securities in its basket and charges 75 bps in annual fees. The product has gathered $8.9 billion in its asset base and trades in average daily volume of 2.2 million shares.
This ETN is linked to the performance of the NYSE FANG+ Index, which is an equal-dollar weighted index, designed to provide exposure to a group of highly traded growth stocks of next-generation technology and tech-enabled companies. It holds 10 stocks in equal weights of 10% each in its basket and charges 58 bps in annual fees. The product has accumulated $56 million in its asset base and trades in average daily volume of 26,000 shares. It has a Zacks ETF Rank #3 (Hold) (read: 5 Best ETFs of Q3 With Room for Further Upside).
O’Shares Global Internet Giants ETF (OGIG - Free Report) – Up 68.9%
The fund invests in some of the largest global companies that derive most of their revenues from the Internet and e-commerce sectors that exhibit quality and growth potential by tracking the O’Shares Global Internet Giants Index. It holds a basket of 71 stocks and charges 48 bps in annual fees. OGIG has been able to attract $406 million in its asset base and trades in average daily volume of 213,000 shares.
WisdomTree Cloud Computing Fund (WCLD - Free Report) – Up 67.2%
This ETF offers exposure to emerging and fast-growing U.S.-listed companies (including ADRs) that are primarily focused on cloud software and services, and follows the BVP Nasdaq Emerging Cloud Index. It holds 53 stocks in its basket and charges investors 45 bps in fees per year. The product has amassed $798.3 million in its asset base and trades in average daily volume of 756,000 shares. It has a Zacks ETF Rank #1 (Strong Buy).
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 >>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
5 Tech ETFs Driving the Market Rally This Year
The technology sector has shown strong resilience amid the coronavirus pandemic. In fact, it has driven the bull market since the March lows and has been the best-performing sector so far this year with the S&P 500 Information Technology climbing more than 26%. In comparison, the S&P 500 and Nasdaq Composite Index has gained 4.4% and 24.9%, respectively.
The gains were primarily driven by mega-cap companies, especially the FAANG stocks though these have bled lately on elevated valuation concerns. Notably, after an astounding surge since the March lows, these stocks are now selling at very rich valuations. Still, they are fundamentally strong.
This is especially true as the COVID-19 pandemic has led to the global digital shift, which has accelerated e-commerce for everything ranging from remote working to entertainment and shopping. The resurgence in coronavirus cases lately and the prospect of lockdowns will continue to fuel demand for Internet (read: Stay-At-Home ETFs to Soar Further on New Lockdown Measures).
Further, the rapid adoption of cloud computing, big data, Internet of Things, wearables, VR headsets, drones, virtual reality, artificial intelligence, machine learning, digital communication and 5G technology will continue to drive the sector higher. As companies across sectors and many individuals are dependent on remote working, cloud-computing services have become essential.
Given this, we have highlighted those tech ETFs that are at the forefront of the broad market rally this year.
ARK Next Generation Internet ETF (ARKW - Free Report) – Up 88.6%
This is an actively managed fund focusing on companies that are expected to benefit from the shift in technology infrastructure to cloud, enabling mobile, new and local services. The fund holds 49 stocks in its basket with AUM of $2.4 billion. It trades in an average daily volume of 726,000 shares and charges 76 bps in annual fees from investors (read: Internet ETFs Are Hot Picks Amid the Coronavirus Crisis).
ARK Innovation ETF (ARKK - Free Report) – Up 83.8%
It is an actively managed fund seeking long-term capital appreciation by investing in companies that benefit from the development of new products or services, technological improvements and advancements in scientific research. In total, the fund holds 47 securities in its basket and charges 75 bps in annual fees. The product has gathered $8.9 billion in its asset base and trades in average daily volume of 2.2 million shares.
MicroSectors FANG+ ETN (FNGS - Free Report) – Up 73.5%
This ETN is linked to the performance of the NYSE FANG+ Index, which is an equal-dollar weighted index, designed to provide exposure to a group of highly traded growth stocks of next-generation technology and tech-enabled companies. It holds 10 stocks in equal weights of 10% each in its basket and charges 58 bps in annual fees. The product has accumulated $56 million in its asset base and trades in average daily volume of 26,000 shares. It has a Zacks ETF Rank #3 (Hold) (read: 5 Best ETFs of Q3 With Room for Further Upside).
O’Shares Global Internet Giants ETF (OGIG - Free Report) – Up 68.9%
The fund invests in some of the largest global companies that derive most of their revenues from the Internet and e-commerce sectors that exhibit quality and growth potential by tracking the O’Shares Global Internet Giants Index. It holds a basket of 71 stocks and charges 48 bps in annual fees. OGIG has been able to attract $406 million in its asset base and trades in average daily volume of 213,000 shares.
WisdomTree Cloud Computing Fund (WCLD - Free Report) – Up 67.2%
This ETF offers exposure to emerging and fast-growing U.S.-listed companies (including ADRs) that are primarily focused on cloud software and services, and follows the BVP Nasdaq Emerging Cloud Index. It holds 53 stocks in its basket and charges investors 45 bps in fees per year. The product has amassed $798.3 million in its asset base and trades in average daily volume of 756,000 shares. It has a Zacks ETF Rank #1 (Strong Buy).
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 >>