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Tech Guru on FAANGs, AMD, a New Disruptive ETF & More

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In this episode of ETF Spotlight podcast, I talked with Gene Munster, managing partner of Loup Ventures. Gene is a well-known tech expert and his firm is the index provider for the Innovator Loup Frontier Tech ETF (LOUP - Free Report) .

LOUP, which made its debut in July, holds 30 cutting-edge technology companies that are leading the next wave of innovation. Doug Clinton, co-founder of Loup Ventures also joined us.

First off, we discussed major themes driving technology forward today, including AI, robotics, autonomous vehicles, computer perception, and virtual and augmented reality.

As these technologies will have profound impact on our lives, they have tremendous growth opportunities. LOUP provides a convenient way for investors to access companies that will collectively influence the future of technology.  

The ETF holds technology companies that have the highest potential for disruption but are not usually included in popular tech ETFs. We discussed how companies are selected and weighted in the index.

The index starts with equal weighing but is adjusted with a conviction weighting that overweights the companies growing and projected to grow revenue, EPS, and cash flow the fastest.

The index excludes companies over $250 billion in market cap, so investors should not expect to see tech giants in the ETF. Gene explained why some of these smaller companies have much better growth potential than tech titans. And companies that grow faster see much better price appreciation.

LOUP’s top holding AMD (AMD - Free Report) has been in the headlines of late due to its meteoric rise. Can the stock continue its uptrend? AMD and NVDA (NVDA), another holding, look well positioned to benefit from rising demand for next-generation AI chips.

Gene is seen frequently on CNBC talking about the FAANGs—Facebook , Apple (AAPL - Free Report) , Amazon (AMZN - Free Report) , Netflix (NFLX - Free Report) , Google's parent Alphabet (GOOGL)--and other tech high fliers.  Investors love these stocks as they have been the main drivers of stock market performance over the past few years, but there are some valuation and regulation related concerns now, particularly after the recent volatility.  

I asked Gene about his views on the FAANGs. Does he have a favorite of the group? Are there any investors should stay away from?  Find out on the podcast.

Please visit innovatoretfs.com if you want to learn more about this ETF. Make sure to be on the lookout for the next edition of the ETF Spotlight! If you have any comments or questions, please email podcast@zacks.com

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