A Technology ETF With Balanced Holdings

With First Trust Nasdaq-100-Technology Sector Index fund, the smallest companies get the same weighting as Apple.

Technology stocks have been on a roll. Over the past 12 months, the sector returned 25.1%, besting Standard & Poor’s 500-stock index by two percentage points. First Trust Nasdaq-100-Technology Sector Index Fund has done even better, with a 34.3% gain over the past year.

Although the exchange-traded fund holds just 41 stocks, it manages to capture a broad swath of the sector, from Apple to Chinese search engine Baidu to Cerner, a health care information-technology firm. Much of the fund’s recent success stems from its hefty exposure to semiconductor stocks, which account for nearly 40% of its assets. One of the fund’s chip stocks, Avago Technologies, soared 124% over the past year, and another, Micron Technology, more than doubled.

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Kaitlin Pitsker
Associate Editor, Kiplinger's Personal Finance
Pitsker joined Kiplinger in the summer of 2012. Previously, she interned at the Post-Standard newspaper in Syracuse, N.Y., and with Chronogram magazine in Kingston, N.Y. She holds a BS in magazine journalism from Syracuse University's S.I. Newhouse School of Public Communications.