The Nasdaq hit a new all-time closing high on Friday, rising again on the back of a strong tech-driven rally. Over the past three years, technology stocks have been the main force behind the broader market’s growth, and the upward trend has continued in 2026.

The surge in demand for artificial intelligence (AI) has pushed major tech companies to invest heavily in infrastructure. At the same time, impressive first-quarter results from the so-called “Magnificent Seven” have further fueled the Nasdaq’s rise.

Given the ongoing bullish trend, investors may find opportunities in tech funds, such as Fidelity Select Semiconductors Portfolio (FSELX Quick QuoteFSELX - Free Report) , T. Rowe Price Science & Tech (PRSCX Quick QuotePRSCX - Free Report) and Janus Henderson Global Technology and Innovation Fund (JNGTX Quick QuoteJNGTX - Free Report) .

Nasdaq Hits New Record

On Friday, the Nasdaq climbed 0.9% to close at an all-time high of 25,114.44 points before giving up some of the gains on Monday. However, the tech-heavy index has had a remarkable journey over the past few years.

The ongoing rally has been largely driven by big tech, especially after strong quarterly earnings from companies such as Amazon, Apple and Microsoft. Continued optimism surrounding AI, particularly generative AI, has also boosted revenues from cloud services and data centers across the industry.

Companies like Microsoft Corporation (MSFT Quick QuoteMSFT - Free Report) , Meta Platforms, Inc. (META Quick QuoteMETA - Free Report) and Alphabet, Inc. (GOOGL Quick QuoteGOOGL - Free Report) have invested heavily in AI development. Meta reported a 33% year-over-year increase in first-quarter revenues, while Alphabet saw a 22% rise. Microsoft also posted an 18% growth in the first quarter.

The Nasdaq’s performance in 2026 has been notable. Although it dipped 2.3% in February amid market volatility, it quickly bounced back, supported by the ongoing AI-driven momentum.

NVIDIA Corporation (NVDA Quick QuoteNVDA - Free Report) has been a major contributor to the index’s gains due to its leadership in AI technology. Meanwhile, Apple’s consistent growth in cloud and AI-related services has also supported the upward movement.

So far this year, the Nasdaq has risen nearly 8% and is expected to maintain steady growth throughout the rest of the year.

3 Best Choices

We've chosen three funds from the tech sector that are a must-buy because of their exposure to AI. These funds have given impressive 3-year and 5-year annualized returns, boast a Zacks Mutual Fund Rank #1 (Strong Buy) or 2 (Buy), offer a minimum initial investment of $5,000 and carry a low expense ratio.

Also, these funds boast an expense ratio of less than 1% and have a minimum initial investment of $5,000.

The question here is: why should investors consider mutual funds? Reduced transaction costs and diversification of portfolios without the several commission charges that are associated with stock purchases are the primary reasons why one should be parking their money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).

Fidelity Select Semiconductors Portfolio fund seeks capital appreciation. FSELX normally invests at least 80% of its assets in common stocks of companies principally engaged in the design, manufacture, or sale of electronic components (semiconductors, connectors, printed circuit boards, and other components); equipment vendors to electronic component manufacturers; electronic component distributors; and electronic instruments and electronic systems vendors.

Fidelity Select Semiconductors Portfolio fund has a track record of positive total returns for over 10 years. Specifically, FSELX’s returns over the three and five-year benchmarks are 42.2% and 33.3%, respectively. The annual expense ratio of 0.61% is lower than the category average. FSELX has a Zacks Mutual Fund Rank #1.

To see how this fund performed compared to its category, and other #1 or 2 Ranked Mutual Funds, please click here.

T. Rowe Price Science & Tech fund seeks to invest in long-term capital growth by investing at least 80% of net assets in common stocks of companies expected by T. Rowe Price to benefit from the development, advancement and use of science and technology. While most of PRSCX’s assets are invested in U.S. common stocks, other securities may also be purchased, including foreign stocks, futures, and options, in keeping with the fund’s objectives.

T. Rowe Price Science & Tech fund has a track record of positive total returns for over 10 years. Specifically, PRSCX’s returns over the three and five-year benchmarks are 25.2% and 9.6%, respectively. PRSCX’s annual expense ratio of 0.80% is lower than its category average of 1.01%. PRSCX has a Zacks Mutual Fund Rank #1.

To see how this fund performed compared to its category, and other #1 or 2 Ranked Mutual Funds, please click here.

Janus Henderson Global Technology and Innovation Fund aims for long-term growth of capital and specializes in technology. JNGTX invests the majority of its net assets in securities of companies that the portfolio manager believes will benefit significantly from advances or improvements in technology.

Janus Henderson Global Technology and Innovation Fund has a track of positive total returns for over 10 years. Specifically, JNGTX’s returns over the three and five-year benchmarks are 24.9% and 11.5%, respectively. The annual expense ratio of 0.81% is lower than the category average of 0.97%. Janus Henderson Global Technology and Innovation Fund has a Zacks Mutual Fund Rank #2.

To see how this fund performed compared to its category and other #1 or 2 Ranked Mutual Funds, please click here.

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