The Information Technology sector ranks fourth out of the ten sectors as detailed in our 3Q16 Sector Ratings for ETFs and Mutual Funds report. It gets our Neutral rating.
The Information Technology sector ranks third out of the ten sectors as detailed in my Sector Rankings for ETFs and Mutual Funds report. It gets my Neutral rating, which is based on aggregation of ratings of 27 ETFs and 157 mutual funds in the Information Technology sector as of January 24th, 2013.
Having too many choices can be intimidating. And there are definitely lots of choices when it comes to ETFs. For example, in the equity market alone, there 30+ technology sector ETFs, or 35 ‘large cap value’ and 20 financial ETFs. A very healthy selection abounds for every category of ETF.
The problem is that these ETFs are not made the same even though they may be in the same category. There are major differences in methodologies between funds, which results in drastically different holdings even within a given sector. See Figure 1.
Our top picks for ETFs for the Information Technology sector are: Internet Architecture HOLDRS (IAH) and Semiconductor HOLDRS (SMH). We also rate the investment merit of the top-12 tech sector ETFs.