Latest news with #XLK
Yahoo
02-06-2025
- Business
- Yahoo
Should You Invest in the Technology Select Sector SPDR ETF (XLK)?
The Technology Select Sector SPDR ETF (XLK) was launched on 12/16/1998, and is a passively managed exchange traded fund designed to offer broad exposure to the Technology - Broad segment of the equity market. While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency. Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Technology - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 7, placing it in top 44%. The fund is sponsored by State Street Global Advisors. It has amassed assets over $71.94 billion, making it the largest ETF attempting to match the performance of the Technology - Broad segment of the equity market. XLK seeks to match the performance of the Technology Select Sector Index before fees and expenses. The Technology Select Sector Index includes companies from the following industries: computers & peripherals; software; diversified telecommunication services; communications equipment; semiconductor & semiconductor equipment; internet software & services; IT services; wireless telecommunication services; electronic equipment & instruments; and office electronics. When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal. Annual operating expenses for this ETF are 0.08%, making it one of the least expensive products in the space. It has a 12-month trailing dividend yield of 0.68%. While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis. This ETF has heaviest allocation in the Information Technology sector--about 100% of the portfolio. Looking at individual holdings, Microsoft Corp (MSFT) accounts for about 14.40% of total assets, followed by Apple Inc (AAPL) and Nvidia Corp (NVDA). The top 10 holdings account for about 61.42% of total assets under management. The ETF has lost about -0.53% so far this year and it's up approximately 10.79% in the last one year (as of 06/02/2025). In that past 52-week period, it has traded between $179.73 and $242.18. The ETF has a beta of 1.21 and standard deviation of 25.64% for the trailing three-year period, making it a medium risk choice in the space. With about 72 holdings, it effectively diversifies company-specific risk. Technology Select Sector SPDR ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, XLK is a great option for investors seeking exposure to the Technology ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well. IShares U.S. Technology ETF (IYW) tracks Dow Jones U.S. Technology Index and the Vanguard Information Technology ETF (VGT) tracks MSCI US Investable Market Information Technology 25/50 Index. IShares U.S. Technology ETF has $19.45 billion in assets, Vanguard Information Technology ETF has $85.21 billion. IYW has an expense ratio of 0.39% and VGT charges 0.09%. To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Technology Select Sector SPDR ETF (XLK): ETF Research Reports Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report NVIDIA Corporation (NVDA) : Free Stock Analysis Report iShares U.S. Technology ETF (IYW): ETF Research Reports Vanguard Information Technology ETF (VGT): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CNBC
12-05-2025
- Business
- CNBC
Buy the tech comeback or take profits? Katie Stockton uses charts to find an answer
Technology stocks are high-beta in nature, meaning they tend to lead the market on the upside and the downside, outperforming when the market is strong and underperforming when the market is weak. Given their tendency to lead the market (in both directions) and their 30% weighting in the S & P 500 Index (SPX) , it is important to have an understanding of where the technology sector stands from a technical perspective. Starting with a monthly bar chart, it is evident the Technology Select Sector SPDR has a secular uptrend in place above the rising monthly cloud model. Within that context, long-term momentum has weakened notably per the monthly MACD, which saw a bearish crossover at the end of March. The "sell" signal is the first since early 2022, and it has implications for at least 6 months of corrective price action, suggesting a cyclical bear market has taken hold. While the technology sector has technically entered a bear cycle, we ultimately expect secular bull to regain hold, likely sometime in 2026. Recently, XLK has rebounded strongly off the April low, with today's gap higher allowing the ETF to clear its 200-day moving average (MA): The breakout extends the rally in a near-term positive development, but the deterioration on the monthly chart is an overhang that suggests the rally may lose momentum abruptly. There is an area of supply on the chart in the $228-$241 zone, where XLK traded in a narrow range from early December through much of February. This is a natural place for the rally to stall, leaving former highs intact. As previously mentioned, technology stocks have a tendency to exhibit upside leadership during rallies and downside leadership during downdrafts. The latest upturn in the ratio of XLK to the SPX reflects outperformance while the market has rebounded. Preceding the upturn, the ratio saw a significant downdraft in Q1 that resulted in a breakdown, indicating a bearish shift in XLK's relative strength trend. This makes the current phase of outperformance appear counter-trend in nature, such that it is likely to be short-lived from here. Once there are signs that the relief rally in the major indices is maturing, we would be quick to reduce exposure to high-beta technology stocks. —Katie Stockton with Will Tamplin Access research from Fairlead Strategies for free here . DISCLOSURES: (None) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL'S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer. Fairlead Strategies Disclaimer: This communication has been prepared by Fairlead Strategies LLC ("Fairlead Strategies") for informational purposes only. This material is for illustration and discussion purposes and not intended to be, nor construed as, financial, legal, tax or investment advice. You should consult appropriate advisors concerning such matters. 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Entrepreneur
12-05-2025
- Business
- Entrepreneur
Tech Bears Should Jump on These 3 Inverse ETFs
With the tech sector down year-to-date and reasons to believe more trouble is in store, these ETFs provide a way to capitalize. This story originally appeared on MarketBeat After reaching a multi-year low in early April amid the tariff-related market selloff, the Technology Select Sector SPDR Fund (NYSEARCA: XLK) has recovered some ground as of mid-May. However, the tech sector as represented by this benchmark fund is still experiencing a lackluster start to the year; XLK is down more than 6% year-to-date (YTD). This represents a sharp reversal from more than two years of fairly steady gains. There are plenty of reasons for investors to be bearish on tech names. First, the threat of tariffs still looms, with many firms particularly dependent upon materials and components from China to keep up the pace of technological development and to maintain affordability for customers. Further, though, sticky inflation—and the prospect of tariff-related inflation increases—means that consumers are likely to continue to tighten belts, forgoing luxury purchases that often include expensive tech products. Investors may be pessimistic about individual tech names, but those more broadly skeptical of the sector may consider an investment in a specialized exchange-traded fund (ETF) that acts as a bet against the space. Below, we look at three inverse ETFs designed to provide positive returns when tech stocks decline. Powerful Double Inverse Exposure to Semiconductor Stocks [content-module:CompanyOverview|NYSEARCA:SSG] Semiconductor stocks are not representative of the breadth of the tech space, but they do connect with a huge portion of it thanks to the many companies relying on their products. The ProShares UltraShort Semiconductors ETF (NYSEARCA: SSG) takes an aggressive bearish view of semiconductor names, applying 2x daily inverse leverage to an index comprised of more than 30 stocks. The target benchmark for SSG, the Dow Jones U.S. Semiconductors Index, includes a range of companies based in the United States that manufacture semiconductors and related equipment. This means the firms may be uniquely exposed to the impact of tariffs and a trade war with China. With double inverse leverage, SSG is a powerful tool for investors expecting semiconductor stocks to decline. However, its leverage resets daily, meaning that it is designed for short-term investors and not those utilizing a longer-term strategy. Holding shares of SSG beyond a single day may compound results, leading to significant discrepancies from the performance of the underlying index. Along with the hefty inverse exposure comes a fairly high fee of 0.95%, but investors targeting this space may be likely to find that expense worth it for a uniquely bearish semiconductor ETF. -3X FANG+ Exposure With Strong Liquidity [content-module:CompanyOverview|NYSEARCA:FNGD] If -2x exposure to semiconductors is not sufficient, extremely bearish investors might turn to the MicroSectors FANG+ Index -3X Inverse Leveraged ETN (NYSEARCA: FNGD) instead. FNGD provides -3x exposure to the NYSE FANG+ Index, a highly concentrated index of just 10 of the largest companies in the tech space. The index includes the FANG stocks as well as CrowdStrike Holdings Inc. (NASDAQ: CRWD), ServiceNow Inc. (NYSE: NOW), and a handful of other major players. FNGD, like SSG above, is designed to reset leverage daily, so it's effectively employed by investors trading within a single day. This factor, combined with the specificity of the underlying index, means that FNGD may be most appropriate for investors anticipating a single-day drop in stock prices for some of the constituents—a political announcement or earnings report that may send shares downward, for example. FNGD's expense ratio is also 0.95%, but it has a key advantage over SSG in that it has a substantially larger trading volume and asset base, making it easier for investors to enter and exit positions in this fund quickly. NASDAQ-100 Index Inverse Exposure [content-module:CompanyOverview|NYSEARCA:QID] The ProShares UltraShort QQQ ETF (NYSEARCA: QID), which targets the NASDAQ-100 Index, is the broadest fund on our list. The NASDAQ-100 is not solely focused on tech stocks, although they typically do represent the majority of the index. QID is a -2x leveraged fund that also resets on a daily basis, making it well-suited to short-term traders. QID has the strongest trading volume of any of the three funds here and also shares a 0.95% expense ratio, like SSG and FNGD above. Its broader focus including non-tech names may make it appropriate for cases in which the wider market is likely to decline as well as those in which the tech sector in particular is trending downward. Before you make your next trade, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. Our team has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and none of the big name stocks were on the list. They believe these five stocks are the five best companies for investors to buy now... See The Five Stocks Here
CNBC
02-05-2025
- Business
- CNBC
Betting on a continued tech comeback with less risk using options
Although the tech sector felt like it was in a freefall in April, it apparently was simply on a bungee cord as we have now seen the Nasdaq 100 ETF (QQQ) snap back more than 20% since the volatile April 7 lows. I want to use options to have the ability to capture even more upside as bullish momentum is driving the bears back into their caves. The S & P 500 is trying to string together a nine-day streak of gains, historic in itself. Front month Nasdaq Futures (June contract) reclaimed 20,000 this morning after nearly dipping under 16,000 less than a month ago. The contrarian in me wants to sell this rip, but the historic volatility in April has created a bifurcation (not just in sentiment) in investment behavior, which should exaggerate moves to the downside and upside alike. That being said, defining risk has never been more important for investors. The Nasdaq 100 is still roughly 10% off all time highs and the under-invested or current shorts in equities could create a melt-up scenario in the month of May. Technicals also are important to consider as a 200-day moving average test seems imminent. When markets become uncertain and emotional in the way they have since the trade tariffs have been clumsily introduced to markets, technicals carry more weight. Do I care about earnings? Of course, and we have had a better-than-expected earnings season thus far with over half of the S & P 500 and most of the Mag 7 already delivering reports. Approximately 73-76% of these companies beat earnings per share (EPS) estimates, with 64% surpassing revenue expectations. The blended EPS growth rate for the S & P 500 is reported at 10.1% to 11.7% year-over-year (YoY), significantly higher than the 6.6% consensus estimate at the quarter's start. Revenue growth is tracking at 4.6-4.7% YoY, slightly above the 4.3-4.4% expected. This marks the seventh consecutive quarter of YoY earnings growth for the index, per FactSet. In summary, Q1 2025 earnings have exceeded diminished expectations for many S & P 500 companies, particularly in tech. The Trade (Call Spread) Bought the 5/30/2025 QQQ $490 Call for $11.50 Sold the 5/30/2025 QQQ $505 Call for $5.00 This Call spread will cost $6.50 or $650 per one spread QQQ was roughly trading $486 when this trade was executed An investor is risking $650 to make $1500, resulting in a net profit of $850 if the spread fully fills out. DISCLOSURES: (Long this call spread, long XLK calls too) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL'S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
Globe and Mail
02-05-2025
- Business
- Globe and Mail
Stock Market News for May 2, 2025
U.S. stock markets closed higher on Thursday to start May. Strong earnings results by AI giants have boosted market participants' confidence on risky assets like equities. No bad news on tariffs and trade related issues also bolstered investors' sentiment. All three major stock indexes ended in green. How Did The Benchmarks Perform? The Dow Jones Industrial Average (DJI) rose 0.2% to close at 40,752.96. The blue-chip index posted a eight-day winning streak, for the first time since July 2024. Notably, 15 components of the 30-stock index ended in positive territory and 15 finished in negative zone. The tech-heavy Nasdaq Composite finished at 17,710.74, rising 1.5% or 264.40 points due to strong performance of technology bigwigs. The S&P 500 was up 0.6% to finish at 5,604.14. The benchmark posted a eight-day winning run, for the first time since November 2024. Eight out of 11 broad sectors of the broad-market index ended in positive territory and three in negative zone. The Technology Select Sector SPDR (XLK) rose 1.5%, while the Health Care Select Sector SPDR (XLV) fell 2.7%. The fear-gauge CBOE Volatility Index (VIX) was down 0.4% to 24.60. A total of 16.15 billion shares were traded on Thursday, lower than the last 20-session average of 19.56 billion. Advancers outnumbered decliners on the NYSE by a 1.31-to-1 ratio. On Nasdaq, a 1.19-to-1 ratio favored advancing issues. Earnings Data Meta Platforms Inc. META reported first-quarter 2025 earnings of $6.43 per share, beating the Zacks Consensus Estimate by 23.18%. The figure surged 36.5% year over year. Revenues of $42.31 billion beat the Zacks Consensus Estimate by 2.61% and increased 16.1% year over year. At constant currency, revenues soared 19% year over year. Microsoft Corp. MSFT reported third-quarter fiscal 2025 earnings of $3.46 per share, which beat the Zacks Consensus Estimate by 8.13% and increased 17.7% on a year-over-year basis. Revenues of $70.06 billion increased 13.3% year over year and beat the Zacks Consensus Estimate by 2.46%. At constant currency, revenues grew 15% year over year, showcasing strong demand for cloud and AI offerings. Consequently, stock price of Meta Platforms and Microsoft climbed 9% and 7.6%, respectively. Both stocks currently carry a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Economic Data The institute of Supply Management (ISM) reported that manufacturing PMI (purchasing managers' index) for April contracted to 48.7% from 49% in March. The consensus estimate was 48.8%. Any reading below 50% indicates contraction in manufacturing activities. The new orders index rose to 47.2% in April from 45.2% in March. The Employment Index in April came in at 46.5% from March's figure of 44.7%. Construction spending decreased 0.5% in March, in contrast to the consensus estimate of an increase of 0.2%. The metric for February was revised downward to 0.6% from 0.7% reported earlier. The Department of Labor reported that initial claims increased 18,000 to 241,000 for the week ended April 26, higher-than the consensus estimate of 225,000. Previous week's data was revised upward from 222,000 to 223,000. Continuing claims (those who have already received government aids and reported a week behind) increased 83,000 to 1.916 million. This is the highest level for insured unemployment since the week ended Nov. 13, 2021. Previous week's data was revised downward by 8,000 to 1.833 million. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. Today, See These 5 Potential Home Runs >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Microsoft Corporation (MSFT): Free Stock Analysis Report Meta Platforms, Inc. (META): Free Stock Analysis Report
