Technology has been able to mute the effects of the pandemic as social distancing and lockdown measures are forcing people to adopt the latest tech in order to facilitate communication for personal or business use.
Traders looking to play the bullish side of tech can use the Direxion Daily Technology Bull 3X ETF (NYSEArca: TECL). TECL seeks daily investment results of 300% of the daily performance of the Technology Select Sector Index, which includes domestic companies from the technology sector.
“Higher by 120% from the lows it hit late in March, the Direxion Daily Technology Bull 3X Shares (TECL) is the third-best performer of Direxion’s tech ETFs, benefitting from increased interest in many of the same growth stocks that have supported the market in the past,” a Direxion Investments X-Change article noted. “This includes Apple and Microsoft, which are both higher by more than 30% from their recent lows.”
“However, looking at TECL’s top-performing components over the course of the past few weeks reveals that much of the ETFs momentum has actually been built on the back of financial technology companies,” the article added further. “This includes blue-chip stocks like Mastercard and Visa, which are both off of their lows by about 30%, and companies like Intuit and Paypal, which have both gained as much as 45% from their recent lows. In Paypal’s case, the stock has surged back to new all-time highs. Of course, there is a whole segment of TECL that we’ve neglected, which leads to the second-best performing tech industry ETF.”
On the other side of the trade, there’s the inverse ETF Direxion Daily Technology Bear 3X ETF (NYSEArca: TECS). TECS seeks daily investment results, before fees and expenses, of 300% of the inverse (or opposite) of the daily performance of the Technology Select Sector Index. The index is provided by S&P Dow Jones Indices and includes domestic companies from the technology sector.
For broad market exposure without leverage, investors wanting a piece large cap tech action can look to the Fidelity MSCI Information Technology Index ETF (FTEC). FTEC tries to reflect the performance of the Nasdaq-100 Technology Sector Index, which consists of companies in the Nasdaq-100 Index classified as technology according to the Industry Classification Benchmark.
Other ways to get broad tech exposure include the Technology Select Sector SPDR ETF (NYSEArca: XLK). XLK tries to reflect the performance of the Technology Select Sector Index, which is comprised of technology and telecom sector of the S&P 500.
For more market trends, visit ETF Trends.