Apple (NasdaqGS: AAPL) shares have played a major role in affecting movements within major indices and exchange traded funds. Technology ETF traders may want to consider the individual stock’s weighting before taking on more sector exposure.
For instance, Apple stocks are the top holding in the Nasdaq Composite. Consequently, the heavy concentration has helped the overall Index outperform other major indices, like the S&P 500 and the Dow. [Technology ETFs: What’s Driving Them?]
Additionally, Apple also makes up almost 20% of overall weightings in market-capitalization weighted tech ETFs, such as the SPDR Technology Select Sector Fund ETF (NYSEArca: XLK).
Potential investors should consider the diversification ramifications before including more Apple shares or technology ETFs into their investment portfolios. [How Equal-Weight ETFs Can Protect a Portfolio]
Individuals who would like to read the full version may take a look at Tom Lydon’s FA Magazine’s blog post.