ETFs for 2013’s Best Tech Stocks
December 12th at 9:30am by Todd Shriber
With a few exceptions, such as old-guard companies like International Business Machines (NYSE: IBM) and Cisco Systems (NasdaqGM: CSCO), 2013 has been good to investors in the technology sector.
Although the Nasdaq Comoposite and the Nasdaq 100, which is tracked by the PowerShares QQQ (NasdaqGS: QQQ), are still far removed from the highs seen prior to the busting of the technology bubble earlier this century, the Nasdaq has performed well this year as highlighted by QQQ’s almost 27% year-to-date gain. [Nasdaq Evolution Could Encourage New Highs]
Some familiar, large-cap tech names have posted jaw-dropping gains in market value this year, benefiting an array of ETFs in the process. In fact, several of this year’s 10 best tech stocks are among the top holdings in scores of tech and Internet ETFs and since some of those names have ascended to triple- and quadruple-digit prices, ETFs are the best way for some investors to access these stocks.
Take the example of Google (NasdaqGM: GOOG). The company’s 2013 market cap gain of almost $131 billion “exceeded Facebook’s entire market value, two HPs or about five Twitters,” writes Aaron Pressman for Yahoo Finance.
Speaking of Facebook (NasdaqGM: FB), which will join the S&P 500 later this month, that stock ranks third in terms of tech sector market cap gains with $75.4 billion. [S&P 500 ETFs Open up to Facebook]
Throw in the almost $64 billion in added market value for Amazon (NasdaqGM: AMZN) and it is easy to see why the First Trust Dow Jones Internet Index Fund (NYSEArca: FDN) and the PowerShares NASDAQ Internet Portfolio (NasdaqGS: PNQI) are up an average about 50% this year. [Triple-Digit Divas Reside in These ETFs]
PNQI has hauled in over $150 million of its $246.1 million in assets under management this year. Amazon, Google and Facebook represent a quarter of PNQI’s weight. The ETF has also been boosted by Priceline (NasdaqGM: PCLN) and Yahoo (NasdaqGM: YHOO), which rank sixth and tenth on top-10 tech stocks of 2013 with a combined $47.5 billion in added market value. Priceline and Yahoo combine for 13.6% of PNQI’s weight.
In order, Google, Amazon, Facebook, Priceline and Yahoo are FDN’s top-five holdings and combine for 38% of the ETF’s weight.