Despite a year full of hand wringing about the impact of rising rates on the stock market, the S&P 500 is still growing steadily. The overall U.S. economy doesn’t just look ok, either; 3.3% annualized growth last quarter suggests a robust environment. While last year’s media headlines stressed about tech stocks, particularly, tech continues to play a leading role in the S&P 500, which may incentive investors to check in on their tech allocations.
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Yes, it’s probable that many investors already have some form of exposure to the so-called “Magnificent Seven.” Big names like Microsoft (MSFT) continue to play a key role in most equities portfolio segments. Finding the right vehicle to invest in those firms, then, matters, for those who use funds to do so.
That’s where a tech stocks ETF like OGIG comes in. OGIG, the ALPS O’Shares Global Internet Giants ETF, tracks the O’Shares Global Internet Giants Index. For a 48 basis point (bps) fee, the strategy’s index looks for global internet tech stocks. Specifically, it looks for firms that meet its growth and quality standards via factors like cash burn rate, for example.
OGIG has returned 29.5% over the last three months thanks to that approach, outperforming its Factset Global Internet Segment average in that time, which only returned 22.9%. What may set OGIG apart for the rest of this year, however, is its global view. The strategy invests in companies like MercadoLibre (MELI), an e-commerce platform active in South American markets, for example.
That global view to internet tech stocks bolsters a standard Magnificent Seven exposure with quality firms in other market conditions. For investors looking to continue a tech play in 2024 with potential rate cuts on the horizon, OGIG may appeal.
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