Apple shares have dipped under $500 per share as observers grow worried over cuts in iPhone production. [Apple Continues to Weigh on Tech Sector, Nasdaq-100 ETF]
In comparison, QQEW spreads out its weighting across its 101 holdings, with the largest component, Celgene Corp (NasadqGS: CELG), at 1.2%. Market-cap breakdown includes giant 15.8%, large 34.3% and medium 49.3%.
Investors who continue to believe in the growing power of the top market capitalization companies in the sector would want stick to a market-cap weighted ETF. However, if the top companies stumble or if the market environment favors smaller firms, an equal-weight ETF would also be a good alternative.
First Trust NASDAQ-100 Equal Weighted Index Fund
For more information on the tech sector, visit our technology category.
Max Chen contributed to this article.
Full disclosure: Tom Lydon’s clients own AAPL and QQQ.