Tech stocks have delivered impressive returns to investors in recent decades. To find evidence of this, please refer to the following information: Technology Select Sector SPDR Fund (XLK) is a popular exchange-traded fund that tracks the S&P 500 technology sector. Over the past 10 years, XLK’s annual total return (price change plus dividends) has averaged 20.5%, nearly twice the return of the S&P 500. 12.4%.
XLK’s performance has been primarily driven by mega-cap tech stocks, including: microsoft (MSFT), apple (AAPL), Nvidia (NVDA), alphabet (GOOGL) and meta platform (META) – All members Magnificent 7. The profits generated by these blue-chip companies have been supported by transformative trends in cloud computing, artificial intelligence (AI), mobile technology, and the Internet of Things (IoT).
Given this past success, investors may wonder whether it is safe to continue with the investment strategy going forward. best stocks The high-tech sector will continue to make profits. The answer is not easy, as the investment environment is prone to unexpected changes.and Interest level Once things return to more normal levels, tech companies’ explosive growth rates could begin to slow.
“Investors will once again find that vast swathes of the information technology sector are experiencing cyclical rather than secular growth,” he said. jordan irvingPortfolio Manager at Glenmede Investment Management LP.
If so, wise stock selection is key for investors looking to capitalize on growth opportunities. Fortunately, there are effective ways to help investors filter through the noise and identify the best tech stocks to buy. There are three things to consider:
