Tech firms have been a key contributor to the S&P 500 this year. While tech has been a huge driver for years now, of course, this year in particular saw the mega-cap tech names responsible for a massive amount of the S&P 500’s growth. Just a few firms including, of course, Nvidia (NVDA) have led the way. That narrative does, however, somewhat unfairly overshadow intriguing opportunities elsewhere in tech. As such, it may be worth looking at tech firms to watch in an internet ETF like OGIG.
What kind of firms are in OGIG, the ALPS O’Shares Global Internet Giants ETF? The internet ETF of course holds some of those megacap tech names like Alphabet (GOOGL). It also invests in names like Duolingo (DUOL).
DUOL, represented by its dedicated owl mascot, produces and maintains a language learning app for on-the-go practice in a wide variety of languages. DUOL has returned 145% YTD per YCharts, a staggering total. The tech firm has also seen 43.5% quarterly year-over-year (YoY) growth. With travel well and truly back following pandemic-era lockdowns, language-curious people from all walks of life may continue to boost DUOL. OGIG weights DUOL at 1.4%.
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Among other term firms to watch in OGIG is Trade Desk, Inc (TTD). The Trade Desk offers a demand-side platform focused on digital marketing that competes with Facebook Ads, among others. It offers programmatic marketing services that rely on real-time, personalized consumer targeting. With online shopping particularly durable not just in the U.S. but around the world, its 87.3% YTD return per YCharts looks appealing moving forward, too. OGIG weights TTD at 1.5%.
Eyeing Tech Firms to Watch in OGIG
Finally, one more company in internet ETF OGIG to watch. Most people who work on a computer are likely familiar with Adobe Inc. (ADBE) already. The firm of course provides content creation, document management, editing, and advertising software.
It’s perhaps the standard in image editing thanks to its Photoshop tool which has become a verb itself for editing images. Returning 57.3% YTD per YCharts, returning 35% on equity, and seeing 19.3% revenue growth over five years, it looks like a very robust, solid pick, weighted at 1.6% by OGIG.
Yes, tech is overrepresented in the S&P 500 right now and looks to be right in the path of rising rates and other challenges. Still, tech remains a key part of any portfolio, and internet ETF OGIG, charging 48 basis points (bps), represents a solid option. It has returned 30.1% YTD and looks like an intriguing strategy entering 2024 thanks to its global tech focus.
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