Technology stocks and tech ETFs have been on a wild ride this year but they remain among the better performing areas of the market. Traders who want to hedge against the wide swings or double down on the moves can look to more aggressive ETF strategies.
For example, the post-Trump, growth-oriented rally has fueled record gains in the technology segment, and more aggressive traders have capitalized on the advance through triple leveraged tech-related ETFs, such as the Direxion Daily Technology Bull 3X Shares (NYSEArca: TECL). TECL takes the leveraged 300% daily exposure of the Technology Select Sector Index.
On the other hand, bearish traders who believe the high-growth segment may be the first to sell off at any signs of trouble may look to something like the Direxion Daily Technology Bear 3X Shares (NYSEArca: TECS), which reflects the -3x or -300% daily performance of the S&P Technology Select Sector Index, to play the down markets.
Related: An ETF for the Tech of Tomorrow
As investors look to President Donald Trump and the White House for guidance, Direxion Investments warned that there are two factors that could weigh on the technology sector. For starters, the issue of visas and whether President Trump would crack down on some of the highly skilled workers needed in the tech industry from other countries.
“It seems as though that issue was overblown, at least as it pertains to tech firms getting the talent they need,” Direxion said.