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Make the Most of the Big Tech Rally With These ETFs
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Investors seem to be mostly braving their fears over the second wave of coronavirus infections on the latest updates from the technological sector. With support from the major tech players, the Nasdaq Composite index rose to a fresh record on Jun 23.
Gaining for eight straight days (longest streak since December 2019) and marking the second straight all-time closing high, the tech-heavy index rose 0.7% in yesterday’s trading session along with Dow Jones Industrial Average rising 0.5% and S&P 500’s 0.4% increase. In the ETF arena, major Nasdaq ETF like Invesco QQQ (QQQ - Free Report) hit a 52-week high in yesterday’s trading session. Meanwhile, popular technology ETFs like iShares U.S. Technology ETF (IYW - Free Report) and Vanguard Information Technology ETF (VGT - Free Report) soared to their 52-week high level.
Tech giant Apple (AAPL - Free Report) led the rally with 2.1% gain to its all-time high level. It was the sixth time in June that the stock closed at a record high and has gained almost 63% in the past three months. Apple has revealed new operating systems for its iPhones and computers. Moreover, the company announced plans to ship Macs with its own custom-designed chips, highlighting its intention to transition from third-party components. Microsoft (MSFT - Free Report) and Amazon (AMZN - Free Report) also rose to all-time highs after gaining 0.7% and 1.9%, respectively.
Moreover, positive comments regarding the U.S.-China phase 1 trade deal from President Trump and White House trade advisor Peter Navarroalso brought in some optimism back in the industry. Going on, although a resurgence is being observed in coronavirus cases, a slew of encouraging economic data indicates that the worst economic scenario might have been over in April. Along with upbeat data, introduction of more stimulus from the central bank and the announcement of Trump administration’s $1-trillion infrastructure spending bill is instilling optimism among investors.
ETFs to Gain
In the current scenario of rising work-from-home and online shopping trends, increasing digital payments, growing video streaming and soaring video game sales are slowly becoming the “new normal.” With the new trends making way, these major technology stocks are expected to continue to gain on rising demand for their products and services.Investors seeking to ride the big tech rally could consider the following ETFs:
Vanguard Information Technology ETF (VGT - Free Report) — up 0.7% on Jun 23
The fund seeks to track the performance of the MSCI US Investable Market Information Technology 25/50 Index. It has AUM of $32.54 billion and average daily volume of around 1.1 million shares. It charges investors 10 bps in annual fees. The fund sports a Zacks ETF Rank #1 (Strong Buy), with a Medium-risk outlook (read: Big Techs Making the Most of Medical Emergency: ETFs to Win).
Technology Select Sector SPDR Fund (XLK - Free Report) — up 0.7%
The fund seeks to provide investment results that, before expenses, correspond generally to the price and yield performance of the Technology Select Sector Index. It has AUM of $31.11 billion and average daily volume of around 16.7 million shares. It charges investors 13 bps in annual fees. The fund sports a Zacks ETF Rank #1, with a Medium-risk outlook (read: Buy These 4 Hot Tech Stocks as Market Recovery Gains Pace).
iShares U.S. Technology ETF (IYW - Free Report) — up 0.7%
The fund seeks to provide investment results that, before expenses, correspond generally to the price and yield performance of the Dow Jones U.S. Technology Capped Index. It has AUM of $5.60 billion and average daily volume of around 191,000 shares. It charges investors 42 bps in annual fees. The fund sports a Zacks ETF Rank #1, with a Medium-risk outlook (read: Ultra-Popular Tech ETFs You Should Not Ignore).
Fidelity MSCI Information Technology Index ETF (FTEC - Free Report) — up 0.7%
The fund seeks to provide investment returns that correspond, before fees and expenses, generally to the performance of the MSCI USA IMI Information Technology Index. It has AUM of $4.06 billion and average daily volume of around 624,000 shares. It charges investors 8 bps in annual fees. The fund sports a Zacks ETF Rank #1, with a Medium-risk outlook.
Investors seeking to ride the Nasdaq bulls could consider the following ETFs. These funds might see massive trading volumes in the days ahead if the afore-mentioned trends stay.
This ETF provides exposure to domestic and international non-financial companies listed on the Nasdaq by tracking the Nasdaq-100 Index. QQQ is one of the largest and most popular ETFs in the large-cap space, with AUM of $116.09 billion and average daily volume of around 51.8 million shares. It charges investors 20 bps in annual fees. The fund sports a Zacks ETF Rank #1, with a Medium-risk outlook (read: Nasdaq is Burning Hot: How to Make the Most of it With ETFs).
First Trust NASDAQ-100 Equal Weighted Index Fund (QQEW - Free Report) — up 0.3%
This fund provides equal exposure to stocks of the Nasdaq-100 Index. It has amassed $846.1 million in its asset base, while it trades in lower volumes of nearly 113,000 shares a day on average. QQEW carries a Zacks ETF Rank #3 (Hold), with a Medium-risk outlook (read: Nasdaq Hits 10,000 for the First Time: ETFs to Bet On).
Fidelity Nasdaq Composite Index Tracking Stock (ONEQ - Free Report) — up 0.9%
This ETF tracks the Nasdaq Composite Index. It has AUM of $2.73 billion and average daily volume of around 75,000 shares. The expense ratio comes is 0.21%. The product carries a Zacks ETF Rank #2 (Buy), with a Medium-risk outlook.
Investors seeking to make big gains in a short span can bet on QLD. It provides twice the return of the NASDAQ-100 Index’s daily performance and sees nearly 2 million shares trading in average daily volume. The fund has AUM of $2.64 billion and charges 95 bps in fees and expenses.
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Make the Most of the Big Tech Rally With These ETFs
Investors seem to be mostly braving their fears over the second wave of coronavirus infections on the latest updates from the technological sector. With support from the major tech players, the Nasdaq Composite index rose to a fresh record on Jun 23.
Gaining for eight straight days (longest streak since December 2019) and marking the second straight all-time closing high, the tech-heavy index rose 0.7% in yesterday’s trading session along with Dow Jones Industrial Average rising 0.5% and S&P 500’s 0.4% increase. In the ETF arena, major Nasdaq ETF like Invesco QQQ (QQQ - Free Report) hit a 52-week high in yesterday’s trading session. Meanwhile, popular technology ETFs like iShares U.S. Technology ETF (IYW - Free Report) and Vanguard Information Technology ETF (VGT - Free Report) soared to their 52-week high level.
Tech giant Apple (AAPL - Free Report) led the rally with 2.1% gain to its all-time high level. It was the sixth time in June that the stock closed at a record high and has gained almost 63% in the past three months. Apple has revealed new operating systems for its iPhones and computers. Moreover, the company announced plans to ship Macs with its own custom-designed chips, highlighting its intention to transition from third-party components. Microsoft (MSFT - Free Report) and Amazon (AMZN - Free Report) also rose to all-time highs after gaining 0.7% and 1.9%, respectively.
Moreover, positive comments regarding the U.S.-China phase 1 trade deal from President Trump and White House trade advisor Peter Navarroalso brought in some optimism back in the industry. Going on, although a resurgence is being observed in coronavirus cases, a slew of encouraging economic data indicates that the worst economic scenario might have been over in April. Along with upbeat data, introduction of more stimulus from the central bank and the announcement of Trump administration’s $1-trillion infrastructure spending bill is instilling optimism among investors.
ETFs to Gain
In the current scenario of rising work-from-home and online shopping trends, increasing digital payments, growing video streaming and soaring video game sales are slowly becoming the “new normal.” With the new trends making way, these major technology stocks are expected to continue to gain on rising demand for their products and services.Investors seeking to ride the big tech rally could consider the following ETFs:
Vanguard Information Technology ETF (VGT - Free Report) — up 0.7% on Jun 23
The fund seeks to track the performance of the MSCI US Investable Market Information Technology 25/50 Index. It has AUM of $32.54 billion and average daily volume of around 1.1 million shares. It charges investors 10 bps in annual fees. The fund sports a Zacks ETF Rank #1 (Strong Buy), with a Medium-risk outlook (read: Big Techs Making the Most of Medical Emergency: ETFs to Win).
Technology Select Sector SPDR Fund (XLK - Free Report) — up 0.7%
The fund seeks to provide investment results that, before expenses, correspond generally to the price and yield performance of the Technology Select Sector Index. It has AUM of $31.11 billion and average daily volume of around 16.7 million shares. It charges investors 13 bps in annual fees. The fund sports a Zacks ETF Rank #1, with a Medium-risk outlook (read: Buy These 4 Hot Tech Stocks as Market Recovery Gains Pace).
iShares U.S. Technology ETF (IYW - Free Report) — up 0.7%
The fund seeks to provide investment results that, before expenses, correspond generally to the price and yield performance of the Dow Jones U.S. Technology Capped Index. It has AUM of $5.60 billion and average daily volume of around 191,000 shares. It charges investors 42 bps in annual fees. The fund sports a Zacks ETF Rank #1, with a Medium-risk outlook (read: Ultra-Popular Tech ETFs You Should Not Ignore).
Fidelity MSCI Information Technology Index ETF (FTEC - Free Report) — up 0.7%
The fund seeks to provide investment returns that correspond, before fees and expenses, generally to the performance of the MSCI USA IMI Information Technology Index. It has AUM of $4.06 billion and average daily volume of around 624,000 shares. It charges investors 8 bps in annual fees. The fund sports a Zacks ETF Rank #1, with a Medium-risk outlook.
Investors seeking to ride the Nasdaq bulls could consider the following ETFs. These funds might see massive trading volumes in the days ahead if the afore-mentioned trends stay.
Invesco QQQ (QQQ - Free Report) — up 0.9% on Jun 23
This ETF provides exposure to domestic and international non-financial companies listed on the Nasdaq by tracking the Nasdaq-100 Index. QQQ is one of the largest and most popular ETFs in the large-cap space, with AUM of $116.09 billion and average daily volume of around 51.8 million shares. It charges investors 20 bps in annual fees. The fund sports a Zacks ETF Rank #1, with a Medium-risk outlook (read: Nasdaq is Burning Hot: How to Make the Most of it With ETFs).
First Trust NASDAQ-100 Equal Weighted Index Fund (QQEW - Free Report) — up 0.3%
This fund provides equal exposure to stocks of the Nasdaq-100 Index. It has amassed $846.1 million in its asset base, while it trades in lower volumes of nearly 113,000 shares a day on average. QQEW carries a Zacks ETF Rank #3 (Hold), with a Medium-risk outlook (read: Nasdaq Hits 10,000 for the First Time: ETFs to Bet On).
Fidelity Nasdaq Composite Index Tracking Stock (ONEQ - Free Report) — up 0.9%
This ETF tracks the Nasdaq Composite Index. It has AUM of $2.73 billion and average daily volume of around 75,000 shares. The expense ratio comes is 0.21%. The product carries a Zacks ETF Rank #2 (Buy), with a Medium-risk outlook.
ProShares Ultra QQQ (QLD - Free Report) — up 1.6%
Investors seeking to make big gains in a short span can bet on QLD. It provides twice the return of the NASDAQ-100 Index’s daily performance and sees nearly 2 million shares trading in average daily volume. The fund has AUM of $2.64 billion and charges 95 bps in fees and expenses.
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 >>