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The technology sector, which was the major victim of inflation fears and lofty valuation concerns, has regained solid momentum in recent weeks. Diminishing worries about runaway inflation compelled investors to pile back into tech-oriented growth stocks.
In particular, tech titans have been roaring with Facebook hitting $1 trillion in market value and Microsoft (MSFT - Free Report) topping $2 trillion market cap for the first time at the end of June. Amazon (AMZN - Free Report) stock is trading at record highs while Apple (AAPL - Free Report) became the trending stock ahead of its next iPhone launch event (read: 4 Sector ETFs That Are In High Momentum).
Additionally, the spike in COVID-19 cases across Asia has once agin propelled the demand for stay-at-home trends, leading to acceleration in e-commerce for everything, ranging from remote working to entertainment and shopping. The rapid adoption of cloud computing, big data, IoT, wearables, VR headsets, drones, virtual reality, AI, machine learning, digital communication and 5G technology will continue to drive the sector higher (see: all the Technology ETFs here).
As such, investors are taking advantage of the beaten-down prices of the companies with robust fundamentals. Given this, we highlight five ETFs that have shown strong momentum over the past month. Investors seeking to benefit from the renewed confidence in the tech sector could find them encouraging picks:
Simplify Volt Cloud and Cybersecurity Disruption ETF – Up 17.6%
This thematic investment product is actively managed and designed to concentrate on those few disruptive companies that are poised to dominate the new era of the cloud and then enhance the concentrated exposure with options. It holds 24 securities in its basket with the largest allocation to the top three firms that collectively make up for 61.7% of the total assets. The ETF is a high-cost choice, charging 1.02% in annual fees. It has accumulated $5.3 million in its assets since its inception in late December and trades in an average daily volume of 16,000 shares (read: 5 ETFs Riding the Growth Comeback Euphoria).
WisdomTree Cloud Computing Fund (WCLD - Free Report) – Up 13.4%
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 57 stocks in its basket and charges investors 45 bps in fees per year. The product has amassed $1.3 billion in its asset base and trades in an average daily volume of 367,000 shares. It has a Zacks ETF Rank #3 (Hold).
This 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 related to the areas of DNA technologies (Genomic Revolution), industrial innovation in energy, automation and manufacturing (Industrial Innovation), increased use of shared technology, infrastructure and services (Next Generation Internet), and technologies that make financial services more efficient (Fintech Innovation). In total, the fund holds 51 securities in its basket and charges 75 bps in annual fees. The product has AUM of $24.8 billion and trades in volume of $10.8 million shares a day on average (read: Tesla Breaks Record on Q2 Deliveries: ETFs to Tap).
TrueShares Technology, AI and Deep Learning ETF (LRNZ - Free Report) – Up 11.4%
It is an actively managed fund targeting companies with leading-edge artificial intelligence, machine learning, or deep learning technology platforms, algorithms, or applications that are believed to provide distinct competitive advantages in an industry historically characterized by a winner-take-all consolidation behavior. It holds 24 stocks in its basket and charges 68 bps in fees per year. LRNZ has amassed $29.5 million in its asset base since its debut a year ago. It trades in an average daily volume of 6,000 shares.
This ETF provides exposure to software companies in the technology and communication services sectors by tracking the S&P North American Expanded Technology Software Index. The fund holds a basket of 122 securities. It is popular with AUM of $4.9 billion and average daily trading volume of more than a million shares. The product charges 46 bps in annual fees and has a Zacks ETF Rank #3 with a High risk outlook.
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Ride the Renewed Tech Momentum With These ETFs
The technology sector, which was the major victim of inflation fears and lofty valuation concerns, has regained solid momentum in recent weeks. Diminishing worries about runaway inflation compelled investors to pile back into tech-oriented growth stocks.
In particular, tech titans have been roaring with Facebook hitting $1 trillion in market value and Microsoft (MSFT - Free Report) topping $2 trillion market cap for the first time at the end of June. Amazon (AMZN - Free Report) stock is trading at record highs while Apple (AAPL - Free Report) became the trending stock ahead of its next iPhone launch event (read: 4 Sector ETFs That Are In High Momentum).
Additionally, the spike in COVID-19 cases across Asia has once agin propelled the demand for stay-at-home trends, leading to acceleration in e-commerce for everything, ranging from remote working to entertainment and shopping. The rapid adoption of cloud computing, big data, IoT, wearables, VR headsets, drones, virtual reality, AI, machine learning, digital communication and 5G technology will continue to drive the sector higher (see: all the Technology ETFs here).
As such, investors are taking advantage of the beaten-down prices of the companies with robust fundamentals. Given this, we highlight five ETFs that have shown strong momentum over the past month. Investors seeking to benefit from the renewed confidence in the tech sector could find them encouraging picks:
Simplify Volt Cloud and Cybersecurity Disruption ETF – Up 17.6%
This thematic investment product is actively managed and designed to concentrate on those few disruptive companies that are poised to dominate the new era of the cloud and then enhance the concentrated exposure with options. It holds 24 securities in its basket with the largest allocation to the top three firms that collectively make up for 61.7% of the total assets. The ETF is a high-cost choice, charging 1.02% in annual fees. It has accumulated $5.3 million in its assets since its inception in late December and trades in an average daily volume of 16,000 shares (read: 5 ETFs Riding the Growth Comeback Euphoria).
WisdomTree Cloud Computing Fund (WCLD - Free Report) – Up 13.4%
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 57 stocks in its basket and charges investors 45 bps in fees per year. The product has amassed $1.3 billion in its asset base and trades in an average daily volume of 367,000 shares. It has a Zacks ETF Rank #3 (Hold).
ARK Innovation ETF (ARKK - Free Report) – Up 12.5%
This 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 related to the areas of DNA technologies (Genomic Revolution), industrial innovation in energy, automation and manufacturing (Industrial Innovation), increased use of shared technology, infrastructure and services (Next Generation Internet), and technologies that make financial services more efficient (Fintech Innovation). In total, the fund holds 51 securities in its basket and charges 75 bps in annual fees. The product has AUM of $24.8 billion and trades in volume of $10.8 million shares a day on average (read: Tesla Breaks Record on Q2 Deliveries: ETFs to Tap).
TrueShares Technology, AI and Deep Learning ETF (LRNZ - Free Report) – Up 11.4%
It is an actively managed fund targeting companies with leading-edge artificial intelligence, machine learning, or deep learning technology platforms, algorithms, or applications that are believed to provide distinct competitive advantages in an industry historically characterized by a winner-take-all consolidation behavior. It holds 24 stocks in its basket and charges 68 bps in fees per year. LRNZ has amassed $29.5 million in its asset base since its debut a year ago. It trades in an average daily volume of 6,000 shares.
iShares Expanded Tech-Software Sector ETF (IGV - Free Report) – Up 9.7%
This ETF provides exposure to software companies in the technology and communication services sectors by tracking the S&P North American Expanded Technology Software Index. The fund holds a basket of 122 securities. It is popular with AUM of $4.9 billion and average daily trading volume of more than a million shares. The product charges 46 bps in annual fees and has a Zacks ETF Rank #3 with a High risk outlook.
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Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>