However the FAANGs out-performance came to an abrupt halt in early March. It has since registered significant fall from the peak right up till the most recent market trading date. Let us look at the FANG+ Index listed on the New York Stock Exchange for a sensing on the drop magnitude.
FANG+ Index, according to its factsheet, is
|FANG+ Index one year price chart. Source: Bloomberg.com|
|Facebook one year price chart. Source: Investing.com|
Make no mistake about it. Based on Facebook's Q4 2017 results, it is still fundamentally strong. Key numbers such as advertising revenue, Monthly Average User, Operating Income are all showing healthy growth.
Well one can consider tech sector Exchange Traded Fund (ETF), especially those with exposure to FAANGs stocks taking up considerable weightage. ETF is also a safer choice as it offers diversification without outsize concentration in any particular stock.
DBS Research recently produce a report citing several FAANG ETFs traded in US worth considering. Some examples include:
- Technology Select Sector SPDR Fund (Ticker symbol XLK). This ETF tracks the Technology Select Sector Index, and holds mainly large and mid-cap technology stocks. Its top three holdings are Apple, Microsoft and Facebook.
- Vanguard Information Technology ETF. It tracks the MSCI US Investable Market Information Technology Index holding tech stocks of all size. Top three holdings are same as above.
Disclaimer: All stocks mentioned in this article are for illustration and education purpose, and do not constitute a buy or sell call.
The author is not vested in these stocks.