3 Tech Focused ETFs to Watch as the Market Nears All-Time Highs
Remarkably, the market is edging closer to record territory, following an impressive V-shaped reversal off its 52-week lows. Many investors may be seeking ways to gain exposure, particularly with the potential for a pullback and consolidation before another leg higher.
Since bottoming out, the SPDR S&P 500 ETF Trust (NYSEARCA: SPY)has rebounded nearly 25%. Even more impressive is the tech-heavy Invesco QQQ Trust (NASDAQ: QQQ), which has surged 32% from its 52-week low. For investors looking for exposure to the tech rally without selecting individual stocks, here are three standout ETFs to consider.
For broad exposure to the biggest names in technology, the Technology Select Sector SPDR Fund (NYSEARCA: XLK) offers a straightforward option. The ETF tracks the Technology Select Sector of the S&P 500, which encompasses industries such as IT consulting, semiconductors, hardware, and telecommunications services.
XLK has jumped nearly 40% off its 52-week low and currently trades just 1.5% shy of its high. The fund is heavily weighted toward three Magnificent Seven members, Microsoft, NVIDIA, and Apple, which together account for nearly 40% of the ETF.
Analyst sentiment is strong, with a Moderate Buy aggregate ratingbased on 1,380 ratings issued in the past year covering 69 holdings. The ETF has ample liquidity, with an average daily volume of 5.1 million shares and a dividend yield of 0.65%.
HACK: Tapping Into the Cybersecurity Boom
One of the standout sub-sectors within tech this year is cybersecurity, a space that has not only outpaced the broader market but even the tech sector itself. The Amplify Cybersecurity ETF (NYSEARCA: HACK) has surged over 44% from its 52-week low, including a 12.5% year-to-date (YTD) gain.
HACK tracks the Prime Cyber Defense Index, targeting firms that provide cybersecurity technology and services through a tiered, equal-weighted strategy. Top holdings include CrowdStrike, Palo Alto Networks, Broadcom, Cisco, and Zscaler, names that have become synonymous with digital defense.
Analysts have issued 519 ratings in the past year on 22 companies (covering over 96% of HACK’s portfolio), resulting in a Moderate Buy aggregate rating. HACK is primarily a solid option for investors looking to capitalize on the growth in digital security. One downside to the ETF, however, is its low liquidity. The ETF has an average volume of just 113,000 shares. The fund has a market capitalization of $2.2 billion and a net expense ratio of 0.6%.
For a more focused bet on North American software giants, the iShares Expanded Tech-Software Sector ETF (BATS: IGV) might be a standout choice. The ETF tracks the S&P North American Technology Software Index, which includes application, enterprise, and entertainment software producers based in the U.S. and Canada.
IGV has gained nearly 40% from its 52-week low, reflecting the software industry’s leading strength during the rebound. The fund has a market cap of $11.6 billion, a 0.45% dividend yield, and a 0.41% expense ratio.
Top holdings include Microsoft, Palantir, Oracle, Salesforce, and ServiceNow. Based on 1,711 analyst ratings covering 110 companies in the portfolio over the past year, IGV also carries a Moderate Buy aggregate rating, highlighting continued optimism in the software space.
Targeted Exposure Within the Leading Technology Sector
With the broader market near all-time highs and tech continuing to lead the charge, ETFs such as XLK, HACK, and IGV offer diversified, targeted exposure to various corners of the sector.
Whether you’re seeking blue-chip stability, cybersecurity growth, or software sector leadership, these ETFs could be valuable additions to a growth-oriented portfolio, especially if the current rally pauses and sets up for another leg higher.
