Technology Could Be a Key Component to Portfolios
Denver, CO
|
April 21, 2023 12:50 PM Eastern Daylight Time
Technology underpins daily life. Every facet of the economy is connected to and reliant on technology. Making tech part of a portfolio should be a consideration for every investor.
The Technology Select Sector SPDR Fund (XLK) offers easy and affordable access to this crucial piece of the U.S. economy. This simple to use and understand product has been trading for more than twenty-four years.
XLK was early to launch in this space and has attracted more than $35 billion in assets under management. It is listed and traded on NYSE Arca so you can buy or sell throughout the day. With an expense ratio of 0.10%* and many brokerages offering commission-free trade, access to XLK and gaining exposure to the technology sector has never been easier.
The fund draws from the S&P 500 tech sector. By weighting toward big caps, there is less volatility by avoiding smaller, less-stable firms.
Top Holdings**
The Technology Sector SPDR fund’s top two holdings, Microsoft and Apple, make up over 40% of the ETF’s holdings – approximately 20% each**.
Along with chipmaker Nvidia, the third largest holding at 4.86%, XLK offers a diverse technology fund that represents the economy in many ways.
XLK currently holds 66 publicly traded technology companies, all components of the S&P 500. XLK trades millions of shares each day with tight trading spreads. Access and cost can make XLK the go-to choice for technology exposure in a well-diversified portfolio.
Why Tech?
How does a tech ETF work into a portfolio? Significantly, in the long term. No industry fuels the economy more than technology. Every facet of life today has technology behind it.
XLK provides investment results that, before expenses, correspond generally to the price and yield performance of the Technology Select Sector Index.
Strategically or tactically, XLK can allow for a more targeted approach than traditional style based investing as well.
Sector Weightings
The fund follows an index that includes a broad mix of the technology sector, which mitigates some of the volatility associated with the sector.
Offering exposure to technology hardware, storage, and peripherals; software; communications equipment; semiconductors and semiconductor equipment; IT services; and electronic equipment, instruments, and components, the sector is well covered with broad exposure.
The technology industry is easily captured here.
Launched in 1998, XLK has been a stalwart in the ETF toolbox for technology exposure in a portfolio and should be a consideration for advisors and investors alike.
DISCLAIMER: This is a work of research and should not be taken as investment or financial advice. Therefore, Select Sector SPDRs or the publisher is not liable for any decision made based on the publication.
About the Company:
Select Sector SPDR ETFs offer flexibility and customization opportunities. Many investors have similar outlooks, but no two are exactly alike. Select Sector SPDR ETFs let investors select the sectors that best meet their investment goals.
*Ordinary brokerage fees apply
**Holdings, Weightings & Assets as of 3/31/23 subject to change
DISCLOSURES
The S&P 500 Index is an unmanaged index of 500 common stocks that is generally considered representative of the U.S. stock market. The index is heavily weighted toward stocks with large market capitalizations and represents approximately two-thirds of the total market value of all domestic common stocks. The S&P 500 Index figures do not reflect any fees, expenses or taxes. An investor should consider investment objectives, risks, fees and expenses before investing.
One may not invest directly in an index.
Transparent ETFs provide daily disclosure of portfolio holdings and weightings
All ETFs are subject to risk, including loss of principal. Sector ETF products are also subject to sector risk and nondiversification risk, which generally will result in greater price fluctuations than the overall market. Diversification does not eliminate risk.
An investor should consider investment objectives, risks, charges and expenses carefully before investing. To obtain a prospectus, which contains this and other information, call 1-866-SECTOR-ETF (732-8673) or visit www.sectorspdrs.com. Read the prospectus carefully before investing.
ALPS Portfolio Solutions Distributor, Inc., a registered broker-dealer, is distributor for the Select Sector SPDR Trust.
Media Contact:
Company: Select Sector SPDRs
Contact: Dan Dolan*
Address: 1290 Broadway, Suite 1000, Denver, CO 80203
Country: United States
Email: dan.dolan@sectorspdrs.com
Website: https://www.sectorspdrs.com/
*Dan Dolan is a Registered Representative of ALPS Portfolio Solutions Distributor, Inc. ALPS Portfolio Solutions Distributor, Inc., a registered broker-dealer, is the distributor for the Select Sector SPDR Trust.
Contact Details
Dan Dolan
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