Investing in the technology sector will always be a good option and very promising. It’s in constant evolution and growth, but we may wonder: Which specific company should I invest in? Or maybe we ask ourselves the big question: What will be the next company that will boom? Answering that question can be very difficult since we can not guess the future, much less spend a lifetime analyzing the thousands of companies that make life in the financial markets. The best option we can have if we want to participate in a diversified way within the technology sector and not miss an opportunity. That said, here are three tech funds to buy that could roar into next year.
iShares Cybersecurity and Tech ETF (IHAK)
The iShares Cybersecurity and Tech ETF (NYSE:IHAK) is an attractive exchange-traded fund (ETF) that focuses on companies specializing in cybersecurity and technology. They are the innovators; the creators of solutions that protect our data in an increasingly digital landscape.
Why should I consider IHAK in my portfolio? First, it offers the opportunity to support the pioneers in cybersecurity innovation. These companies are at the forefront, inventing the safeguards that keep our data safe online. In addition, they offer exposure to a diversified set of global companies. That diversity helps mitigate risk while allowing investors to take advantage of opportunities around the world.
IHAK does not seek only short-term gains, but is focused on long-term growth. The fund invests in companies poised to shape the global economic landscape. However, it is important to note that past performance has been up and down, indicating that returns are never guaranteed.
As of September 2023, it had assets of approximately $607 million, clearly demonstrating considerable investor interest. In addition, the ETF distributes dividends semi-annually, which can provide a steady income stream for investors.
Technology Sector SPDR (XLK)
The Technology Select Sector SPDR Fund (NYSE:XLK) is an ETF designed to mirror the performance of the technology sector within the S&P 500 index.
Think of XLK as a basket filled with stocks of technology-related companies. The holdings encompass companies involved in hardware and software manufacturing, offering cybersecurity services, telecommunications and semiconductors — to name a few.
Why is this a wise addition to your investment portfolio? On the investment side, the technology sector has shown solid and steady growth. The inexorable march of technology continues, making these companies a beacon of long-term growth potential.
Financially, as of September 2023, the fund had assets under management totaling approximately $47.6 billion. That underscores the confidence placed in it by numerous investors seeking exposure to the dynamism of the technology sector.
VanEck Semiconductor ETF (SMH)
The VanEck Semiconductor ETF (NASDAQ:SMH) resembles an enchanted investment treasure chest. This fund allows you to closely track the performance of companies specializing in semiconductors — the tiny chips that power our digital world. Investing in SMH is like stepping into the very heart of the technological revolution.
What sets it apart is its accessibility, especially for European investors. VanEck is the first of its kind in the region. The fund focuses on companies heavily involved in semiconductors, with at least half of its revenues coming from this sector. Liquidity is a priority, ensuring ease of buying and selling for investors.
In financial terms, this fund has approximately $9.42 billion in net assets, with investments spread across about 26 leading companies in the semiconductor industry. This diversification not only minimizes risk but also positions you to capitalize on the global growth of this sector.
As of this writing, Gabriel Osorio-Mazzilli did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
