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3 Funds to Bank on Nasdaq's Growth So Far This Year
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The tech-laden Nasdaq Composite closed the Jun 23 session at another record high. The index has come a long way, with Tuesday’s close being its 21st closing record so far this year. What’s more, the index’s Jun 23 closing points of 10,131.37 was its longest winning streak since December 2019, marking the eighth day of gains.
Nasdaq Rises Despite All Odds
Although the year so far has had a bumpy ride on the index, the tech-laden benchmark index has managed to touch new highs. The index left behind its lowest point on Mar 23 and rose on the back of some notable tailwinds.
With the pandemic hitting hard the United States and abroad in late-February, people shifted their major tasks online as staying home became mandatory. Work-from-home jobs gained prominence, and with it gained a string of companies that offered products and services related to the trend. Most of these were technology companies, of course.
Second, the demand for high-speed Internet connection rose, and that drove the need for memory chips, semiconductor devices and other products of technology to make one’s home office on par with that of corporate environment. All of these factors aided the technology space. Critical areas such as cloud services, cybersecurity, remote-working technology, online learning, and communication services such as video conferencing and audio gained prominence.
Moreover, autonomous driving tech, technology to be aware of active COVID-19 cases near one, and AI products and services also became popular. All these aided the Nasdaq Composite’s uptick. It is interesting to note that as of Jun 23, both the broader S&P 500 and the Dow Jones have lost 3.5% and 8.8% (since the beginning of the year) respectively, but the Nasdaq Composite has gained 12.9% in the same timeframe, highlighting the strong factors backing it.
3 Funds to Buy
We have, therefore, selected three mutual funds that invest in technology companies. All these funds carry a Zacks Mutual Fund Rank #2 (Buy). In addition, the minimum initial investment for these funds is within $5,000.
We expect these funds to outperform their peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance but also on the likely future success of the fund.
The question here is why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).
BlackRock Technology Opportunities Fund Investor A Shares (BGSAX - Free Report) aims for capital appreciation. The fund invests the majority of its assets in securities of U.S. and non-U.S. technology companies. BGSAX invests in companies from both developed and emerging markets alike. The fund invests primarily in common stocks of companies but it may also invest in preferred stock and convertible securities.
This Zacks sector – Tech has a history of positive total returns for more than 10 years. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
BGSAX has an annual expense ratio of 1.18%, which is below the category average of 1.29%. It has returned 41.4% over the past year. The fund has a minimum initial investment of $1000.
Columbia Global Technology Growth Fund Class A (CTCAX - Free Report) aims for capital growth. The fund invests the majority of its assets in securities of technology companies that may gain from technological improvements, advancements or developments. Although the fund mostly invests in common stocks of companies, it may also invest in preferred stocks and securities convertible into common or preferred stocks.
This Zacks sector – Tech has a history of positive total returns for more than 10 years. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
CTCAX has an annual expense ratio of 1.12%, which is below the category average of 1.29%. It has returned 31.3% over the past year. The fund has a minimum initial investment of $2000.
Fidelity Advisor Semiconductors Fund Class A (FELAX - Free Report) aims for capital appreciation. The fund invests the majority of its assets in securities of companies that develop, manufacture and market electronic components and equipment etc. The non-diversified fund, which invests in U.S. and non-U.S. companies alike, primarily invests in common stocks of companies.
This Zacks sector – Tech has a history of positive total returns for more than 10 years. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
FELAX has an annual expense ratio of 0.50%, which is below the category average of 0.99%. It has returned 43.1% over the past year. The fund has no minimum initial investment.
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Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing mutual funds, each week.
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3 Funds to Bank on Nasdaq's Growth So Far This Year
The tech-laden Nasdaq Composite closed the Jun 23 session at another record high. The index has come a long way, with Tuesday’s close being its 21st closing record so far this year. What’s more, the index’s Jun 23 closing points of 10,131.37 was its longest winning streak since December 2019, marking the eighth day of gains.
Nasdaq Rises Despite All Odds
Although the year so far has had a bumpy ride on the index, the tech-laden benchmark index has managed to touch new highs. The index left behind its lowest point on Mar 23 and rose on the back of some notable tailwinds.
With the pandemic hitting hard the United States and abroad in late-February, people shifted their major tasks online as staying home became mandatory. Work-from-home jobs gained prominence, and with it gained a string of companies that offered products and services related to the trend. Most of these were technology companies, of course.
Second, the demand for high-speed Internet connection rose, and that drove the need for memory chips, semiconductor devices and other products of technology to make one’s home office on par with that of corporate environment. All of these factors aided the technology space. Critical areas such as cloud services, cybersecurity, remote-working technology, online learning, and communication services such as video conferencing and audio gained prominence.
Moreover, autonomous driving tech, technology to be aware of active COVID-19 cases near one, and AI products and services also became popular. All these aided the Nasdaq Composite’s uptick. It is interesting to note that as of Jun 23, both the broader S&P 500 and the Dow Jones have lost 3.5% and 8.8% (since the beginning of the year) respectively, but the Nasdaq Composite has gained 12.9% in the same timeframe, highlighting the strong factors backing it.
3 Funds to Buy
We have, therefore, selected three mutual funds that invest in technology companies. All these funds carry a Zacks Mutual Fund Rank #2 (Buy). In addition, the minimum initial investment for these funds is within $5,000.
We expect these funds to outperform their peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance but also on the likely future success of the fund.
The question here is why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).
BlackRock Technology Opportunities Fund Investor A Shares (BGSAX - Free Report) aims for capital appreciation. The fund invests the majority of its assets in securities of U.S. and non-U.S. technology companies. BGSAX invests in companies from both developed and emerging markets alike. The fund invests primarily in common stocks of companies but it may also invest in preferred stock and convertible securities.
This Zacks sector – Tech has a history of positive total returns for more than 10 years. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
BGSAX has an annual expense ratio of 1.18%, which is below the category average of 1.29%. It has returned 41.4% over the past year. The fund has a minimum initial investment of $1000.
Columbia Global Technology Growth Fund Class A (CTCAX - Free Report) aims for capital growth. The fund invests the majority of its assets in securities of technology companies that may gain from technological improvements, advancements or developments. Although the fund mostly invests in common stocks of companies, it may also invest in preferred stocks and securities convertible into common or preferred stocks.
This Zacks sector – Tech has a history of positive total returns for more than 10 years. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
CTCAX has an annual expense ratio of 1.12%, which is below the category average of 1.29%. It has returned 31.3% over the past year. The fund has a minimum initial investment of $2000.
Fidelity Advisor Semiconductors Fund Class A (FELAX - Free Report) aims for capital appreciation. The fund invests the majority of its assets in securities of companies that develop, manufacture and market electronic components and equipment etc. The non-diversified fund, which invests in U.S. and non-U.S. companies alike, primarily invests in common stocks of companies.
This Zacks sector – Tech has a history of positive total returns for more than 10 years. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
FELAX has an annual expense ratio of 0.50%, which is below the category average of 0.99%. It has returned 43.1% over the past year. The fund has no minimum initial investment.
Want key mutual fund info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing mutual funds, each week.
Get it free >>