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The Smartest Tech ETF to Buy With $1,000 Right Now

Neil Patel, The Motley Fool

4 min read

In This Article:

  • This popular ETF has produced a terrific 428% return over the past decade, outperforming the S&P 500.

  • Investors can rest assured knowing they have adequate exposure to tech-related areas, such as the ongoing AI race.

  • Thanks to a low fee structure, investors are able to keep more of their returns over time.

  • 10 stocks we like better than Invesco QQQ Trust ›

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We always hear about the great investors. For instance, Warren Buffett's 60-year track record leading Berkshire Hathaway has made him a legend. He has built an unbelievable career picking individual stocks, and it seems everyone follows his every move.

However, the average investor may want to go a different route. Thanks to the advent of exchange-traded funds (ETFs), it's easier than ever to gain exposure to different sectors, themes, factors, or asset classes in your portfolio. This could be the right approach for many people who desire a laid-back approach.

Let's say you want to invest $1,000 in one of the hottest trends of the past decade. Here's the smartest tech ETF to buy right now.

ETF superimposed over stock charts and tickers.

Image source: Getty Images.

The S&P 500 index gets all the attention. Because it tracks 500 large and profitable companies, this makes sense. It's the most closely watched benchmark to gauge the performance of the stock market.

Investors need to take a closer look at the Invesco QQQ Trust (NASDAQ: QQQ), though. This ETF comprises the 100 largest non-financial companies listed on the Nasdaq stock exchange. In the past decade, it has generated a total return of 428% (as of June 11). That's significantly better than the performance of the S&P 500.

While there are 100 different securities in the Invesco QQQ Trust, the portfolio is heavily concentrated in technology-related enterprises. The top 10 positions comprise 50% of the entire portfolio. Nine of these companies have exposure to the technology trend within their respective industry niches. The other business in the top 10, Costco, operates in the retail sector.

The beauty of investing in the Invesco QQQ Trust is that investors don't need to accurately predict which companies will succeed in an uncertain future. These days, technology is changing faster than ever, and this has huge implications for businesses trying to benefit. For even the most seasoned investors with subject matter expertise, it can seem like an impossible task to figure out how things will shake out in five or 10 years.

By owning the Invesco QQQ Trust, you're ensuring that you will own tomorrow's biggest winners. You don't have to be an authority in artificial intelligence, for example, to help your portfolio. By adopting a low-maintenance strategy and buying this ETF, you're positioning yourself to profit from these trends.